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|  Segment# |

| 5 |

| Location |

|  |

|  Date |

| 1/9/2007 |

| |

|  Story Name |

| I-TECHNOLOGY CUTTING EDGE |

| |

|  Notes |

|  |

| |

|18:39:04 |

|Prepared by The Transcription Company, , (818) 848-6500 |

|Which takes sole responsibility for accuracy of transcription |

|18:39:04 CHARLES GIBSON |

|(OC) And in San Francisco, in domestic news today, one of the most |

|highly anticipated product rollouts in memory. With its iPod, apple |

|Computer changed how Americans and the world buy and listen to music. So |

|when word spread that Apple was getting into the business of cell phones |

|and televisions, expectations were very high. Apple's CEO Steve Jobs said |

|his company will introduce a box to link your computer and your |

|television. And they'll introduce a new phone that does just about |

|everything. Here's ABC's Neal Karlinsky. |

|GRAPHICS: CUTTING EDGE? |

|18:39:36 NEAL KARLINSKY, ABC NEWS |

|(VO) Outside the Mac World conference, the scene was somewhere between a |

|rock concert and a religious experience. |

|18:39:42 STEVE JOBS, CEO |

|Today, Apple is going to reinvent the phone. |

|18:39:46 NEAL KARLINSKY |

|(VO) The iPhone has been rumored for years. The real thing makes calls, |

|plays movies and music and seeks to do no less than revolutionize the cell |

|phone industry and computer world. |

|18:39:56 DECLAN MCCULLAGH, ANALYST |

|Apple's combined a lot of technologies that were out there in different |

|products. They lumped it all together. They seem to have done it well. |

|And so their business is right on the edge of being revolutionary. It |

|could be as revolutionary as the original iPod. |

|18:40:08 NEAL KARLINSKY |

|Jobs told us the phone was borne out of frustration with traditional cell |

|phones. |

|18:40:12 STEVE JOBS |

|One of the big motivating factors for us is just creating something that |

|we all want ourselves, too. |

|18:40:18 NEAL KARLINSKY |

|(VO) Security is so tight it took us all day to get exactly two minutes |

|alone with the phone. |

|18:40:24 NEAL KARLINSKY |

|(OC) The device itself is actually pretty small. You can see it's very |

|thin. It only has one real button. They call this a home button. The |

|rest is operated on a touch-sensitive screen. They say this phone alone |

|is an iPod, a cell phone, a computer and a BlackBerry all wrapped into |

|one. |

|18:40:38 NEAL KARLINSKY |

|(VO) Apple has already sold more than 70 million iPods and clearly |

|dominates digital music. But the cell phone market is bigger than music. |

|More than a billion cell phones are expected to be sold worldwide this |

|year. Apple's entry into that market is a clear shot across the bow of |

|traditional cell phone providers. |

|18:40:56 DECLAN MCCULLAGH |

|Then if Apple can - takes the market share away from HP and Palm, there's |

|a lot of room to grow. |

|18:41:03 NEAL KARLINSKY |

|(VO) The iPhone comes out in June. And if the iPod's success is any |

|indication, you may be seeing a lot of them. Neal Karlinsky, ABC News, |

|San Francisco. |

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