Development of what became the iPhone ("Project Purple") began in 2004 with a team of 1,000 employees including designer Sir Jonathan Ive. Apple CEO Steve Jobs steered the original focus away from a tablet, like the iPad, and toward a phone. Apple created the device during a secretive collaboration with AT&T Mobility — Cingular Wireless at the time — at an estimated development cost of $150 million over thirty months.
Apple rejected the "design by committee" approach that yielded the Motorola ROKR E1, a largely unsuccessful collaboration with Motorola. Instead, Cingular gave Apple the liberty to develop the iPhone's hardware and software in-house and even paid Apple a portion of its monthly service revenue (until the iPhone 3G), in exchange for four years of exclusive US sales ending in 2011.
Jobs unveiled the iPhone on January 9, 2007, during Macworld at the Moscone Center in San Francisco. The two initial models, a 4 GB unit priced at $499 and an 8 GB model at $599, went on sale in the US on June 29, 2007 at 6 pm local time. Hundreds of customers lined up outside stores nationwide. The passionate reaction to the iPhone launch resulted in some of the media dubbing it the 'Jesus phone'.