"We want to do the right thing for our valued iPhone customers. We apologise for disappointing some of you, and we are doing our best to live up to your high expectations," Mr Jobs said.

For many the price cut slipped by unnoticed as the company unveiled a slew of new gadgets, including adding a touch-screen iPod to Apple's popular line of portable music players.

At the news conference, the firm also revealed that the four-gigabyte model of the iPhone was being dropped.