Apple says has sold 4 million iPhones

SAN FRANCISCO (Reuters) - Apple Inc's chief Steve Jobs said on Tuesday the company had sold 4 million iPhones and he announced updated services for the device.

Apple shares were down about 5 percent to $169.89 (86 pounds) after Jobs started speaking at the highly anticipated annual Macworld convention in San Francisco.

"Apparently, investors aren't impressed with what they've heard so far," said one trader, who asked for anonymity.

Apple's first phone, launched at the end of June, represented about 19.5 percent of the U.S. smart phone market in its first 90 days, Jobs told the attendees.

Smart phones, which have computer-like features such as Web browsing, represent a small part of the cell phone market. The company said in October that it had sold about 1.12 million units of iPhone in the third quarter.

AT&T Inc is the exclusive U.S. carrier for iPhone, which is also on at T-Mobile, owned by Deutsche Telekom, in Germany, at France Telecom in France and at O2, owned by Telefonica in the United Kingdom.

Jobs also announced new software for iPhone, including a 'web clips' feature, which essentially turn bookmarks into icons that can be displayed on the phone's home screen.

"The iPhone is not standing still. We keep making it better and better and better," Jobs said.

Web clips and other features will also be available for the iPod Touch, which has a Wi-Fi short range connection but no cell phone links. Apple said plans to charge existing iPod Touch customers $19.99 for the software upgrade, which will be available free for existing iPhone users.

(For more tech news see Reuters' Mediafile blog at

blogs.reuters.com/mediafile)

(Reporting by Scott Hillis and Duncan Martell, writing by

Sinead Carew in New York, editing by Mark Porter, Leslie Gevirtz)