Apple goes small for new iPhone, iPad

"Some people really love smaller phones," he told the event at Apple's headquarters in Cupertino, California, unveiling the aluminum handset with upgraded specifications and other features including Apple Pay.

"In some countries like China, for a majority of these customers it is their first iPhone." The iPhone SE will be aimed at first-time Apple buyers and those who want to upgrade from the iPhone 5S and 5C, which have not been updated in over two years. The iPhone 6S, the lowest-cost handset in the large-screen family, starts at USD 649.

Also unveiled at the event was a new iPad Pro that also moves smaller -- a 9.7 inch display compared with the 12.9 inch model on the original business-geared tablet.

"It is a large enough display to get all your work done, but easy to carry around," said Apple vice president Phil Schiller.

The smaller, new iPad starts at USD 599 for US customers, down from around USD 800 for the original.

Apple will be taking orders Thursday for the new phone and tablet, with deliveries set for March 31, in the United States, Britain, Australia, Canada, China, France, Germany, Hong Kong, Japan, New Zealand and Singapore, with more markets to come online in April.

Apple is seeking "to kickstart the upgrade cycles for both iPhones and iPads," said Jan Dawson at Jackdaw Research.