vergeApple just confirmed plans to offer a new iPhone model, the iPhone 5C, in a variety of colors, selling for $99 for a 16 GB model and $199 for 32 GB.

The new iPhone models replaces the company’s previous strategy of offering older versions of the iPhone for reduced prices when it debuts a new smartphone.

[Related: Nokia pokes fun at Apple’s colorful new iPhone 5C line, says ‘imitation is the best form of flattery’]

Apple also confirmed plans for the iPhone 5S, a larger upgrade to its signature smartphone. The device will have a 64-bit processor, similar to many desktop computers. The 5S comes with a “motion coprocessor” that will enable new health and fitness apps by working in conjunction with sensors on the device.

The iPhone 5S will sell for $199 (16GB) $299 (32GB) or $399 (64GB) with a two-year contract. It will be available on Sept. 20.

The company is showing an upgraded camera for the iPhone 5S with a new lens and larger pixels in a sensor with 15 percent larger active area, with new technologies for sharper pictures.

Apple also confirmed that a fingerprint reader is embedded into the home button, called the Touch ID, for securely unlocking the phone and logging into apps. (No more entering your Apple ID into the App Store when you buy an app.)

The iPhone 4S (8GB) will be available for free with a contract, but the iPhone 5 will be discontinued.

The company’s media event in Cupertino, Calif., also included news that Apple will make iWork and other apps available for free on new iOS devices. That includes the Keynote, Pages and Numbers apps, which normally sell for $9.99 for the iPad.

That’s a pre-emptive strike against Microsoft, which offers mobile versions of Word, Excel and other apps via Office 365 for iPhone, but requires a $100/year subscription. Microsoft has so far stopped short of offering a native Office app for Apple’s iPad.

Earlier in the event, the company announced plans to release iOS7 for existing iPhones and iPads on Sept. 18. The new OS will also run on the new iPhones.

For photos of the new iPhones, head here.

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  • Guest

    Those are prices with a 2 year contract, no?

    • Todd Bishop

      Yes, correct.

      • Guest

        So the 16GB 5C is $549 off contract in the US? Not clear how that helps them in foreign markets where price is major concern and subsidies often don’t apply.

  • Guest

    Thanks, Tim. Next time a press release reading “yup” would be more cost-effective. Why go to a press conf to see a point release of hardware we already know?

  • Eric

    I might be wrong, but there is no such thing as an 8 GB iPhone 4S, only an 8gb iPhone 4.

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