Apple (AAPL :

Apple Inc

News , chart , profile , more

Last: 124.35+3.85+3.20%
1:21pm 06/18/2007
Delayed quote data

Add to portfolio
Analyst
Create alert

Insider
Discuss
Financials

Sponsored by:

AAPL124.35, +3.85, +3.2%) shares climbed $3.13 to $123.61 after the company said it has made improvements in the iPhone's battery life.

Volume was heavy, with more than 19 million Apple shares changing hands in afternoon trading. The action is the latest for a stock that has surged more than 47% since the introduction of the iPhone at a conference in January.

"It's easy to look and say that the iPhone is overhyped," said Andy Hargreaves, who covers Apple for Pacific Crest Securities and has an outperform rating on the stock. "The attention that has been given to the iPhone is probably more than the significance of the product at this point."

In a statement Monday, Apple said improvements to the iPhone's battery will give the device up to eight hours of talk time with six hours of Internet use and seven hours of video playback. Playback of songs can reach 24 hours, according to the company.

Previously, Apple said the iPhone would be capable of five hours of each of talk time, Internet use or video playback, and 16 hours of audio playback time.

Additionally, the company said the iPhone's touch-screen would be made of glass instead of plastic in order to ensure better screen clarity and scratch resistance.

Battery time is always an issue with any handheld media player or cell phone. As many devices are used, their batteries are known for being less able to hold charges for as long as when the products were first purchased.

Analysts that follow Apple say the hype over something seemingly innoucuous as a product's battery life shows how rationality can be thrown out the window when Apple is involved.

Shaw Wu, an analyst with American Technology Research, sounded a note of skepticism about Apple's latest battery times. In an interview Monday, he said "sources have indicated [the] iPhone's active use battery live may be closer to about four-to-five hours," for heavy use similar to that of so-called smartphones.

Wu said that because an iPhone will also serve as an iPod, unless Apple's claims are accurate, "four-to-five hours of video playback [for example] might not be enough. We will find out in a few weeks." Wu holds a buy rating on Apple's stock.

But even Hargreaves of Pacific Crest admits that the excitement over the iPhone isn't to be unexpected.

"It's hard to underhype the importance of this project," he said. "If Apple captures a meaningful portion of the [cell phone] market, there's a big opportunity for new services for them."

Apple has set a June 29 release date for the iPhone, which combines a cell phone with an iPod and an Internet connection device. The device will come in two models, a $499 version with 4 gigabytes of storage, and a $599 model that has 8 gigabytes of storage.