AT&T quits taking iPhone 4 orders due to high demand/Orders for the iPhone 4 Top 600,000, Apple Says

AT&T quits taking iPhone 4 orders due to high demand
By Jefferson Graham
Copyright by USA TODAY
June 16, 2010
http://www.usatoday.com/tech/news/2010-06-16-iphone16_ST_N.htm


AT&T suspended iPhone 4 orders Wednesday after demand overwhelmed inventory.

Apple says it and AT&T took orders for more than 600,000 of its new iPhone 4. It was the largest number of orders Apple has taken in one day, and far more than anticipated, Apple says.

AT&T, exclusive U.S. carrier for Apple's iPhone, said it will resume taking orders when additional inventory becomes available.

"We are working hard to bring the iPhone 4 to as many of our customers as soon as possible," AT&T said.

Apple's website was accepting orders for black models only, and only for shipping by July 2.

Apple's new iPhone went on sale Tuesday for orders — and once again, the company experienced big problems.

Online and phone systems at Apple and AT&T were jammed. Many consumers complained of not being able to get through, similar to launches for previous iPhones.

"Due to extremely high call volumes, we are unable to answer your call at this time," said a recording on the Apple phone line for purchasers. "Please call back."

The situation wasn't any better with online sales, where the websites seemed to be in a state of perpetual crashing, or long waits.

"We apologize to everyone who encountered difficulties, and hope that they will try again or visit an Apple or carrier store once the iPhone 4 is in stock," Apple said in a statement.

AT&T said Wednesday that there were more than 13 million visitors to AT&T's website Tuesday to specifically check whether they were eligible for a phone upgrade. That's 3 times more than any previous day.

"The good news for Apple: A lot of people want to buy the product," says Van Baker, an analyst at Gartner. "The bad news: system glitches that totally overwhelmed the system."

AT&T told the Associated Press it received reports of customers seeing wrong account information Tuesday but wasn't able to replicate the problem and was investigating. The company said the personal information users were seeing in one another's accounts didn't include Social Security numbers, credit card information and detailed call logs.

Baker at Gartner said he doesn't think Tuesday's glitches are necessarily a problem for Apple. "What are (consumers) going to do — hang up, and go out and buy Android phones instead? No, they'll just try again tomorrow."

Rick Popowitz, CEO of Biocentric Health in Bethesda, Md., was one of the Apple customers who gave up on online and phone methods Tuesday morning. Popowitz ultimately drove to a local shopping mall and ordered the phone at an AT&T store.

A salesperson told him he'd get a call when the phone arrives on June 24. Popowitz says his receipt was handwritten, "because AT&T's system was down."

Other consumers found a way around Apple's tech woes via the new Apple Store app for the iPhone and iPod Touch. Released Tuesday, it enables customers to buy directly from the store and make reservations for in-store tech support.

The demand for the new iPhone comes as Apple is still trying to get the sales pipeline for its iPad touch-screen tablet computer under control. It's been for sale since April 3 and there are still product shortages. Many stores report sell-outs, and Apple's website says orders ship in seven to 10 business days.

Baker thinks the iPad situation is different. "That's one where Apple clearly got their forecasts wrong and are trying to catch up," he says. "The iPhone is just a system glitch."

The new iPhone 4 starts at $199 with a new two-year contract or upgrade, and includes a thinner body, higher-resolution display and two-way video calling.

Apple shares rose $5.24 Tuesday to $259.69.

Just last week, AT&T plugged an embarrassing security hole on its website that exposed the e-mail addresses of people who had bought another new Apple product, the iPad 3G.

And in January, AT&T acknowledged to The Associated Press that a problem in its network was causing some wireless customers to land in strangers' Facebook accounts when they tried to check their own accounts using their smart phones. AT&T said it was fixing that glitch.

It doesn't happen often, but the Internet can forget who is who when multiple people log onto a site at the same time.

AT&T blamed a "misdirected cookie" for at least one of the problems in January. A cookie is a file websites place on users' computers to identify them. If the Internet provider fumbles a cookie and sends it to the wrong computer, the person using that computer will see a Web page he or she wasn't expecting.

Contributing: Edward C. Baig and Charlie Szold of USA TODAY; Associated Press


Orders for the iPhone 4 Top 600,000, Apple Says
By JENNA WORTHAM
Copyright by The New York Times
Published: June 16, 2010
http://www.nytimes.com/2010/06/17/technology/17phone.html?th&emc=th


Apple said on Wednesday that it and its partners took more than 600,000 orders for the new iPhone 4 on Tuesday, the first day they were accepted, despite technical flaws that prevented many orders from going through..

The company apologized to customers who were frustrated by the computer hiccups, which affected the Web sites of Apple and AT&T and the ordering system in AT&T stores. Apple attributed the problems to high demand and asked customers to “try again or visit an Apple or carrier store once the iPhone 4 is in stock.”

“It was the largest number of preorders Apple has ever taken in a single day and was far higher than we anticipated, resulting in many order and approval system malfunctions,” Apple said in a statement.

Investors appeared to be pleased with the sales figure, pushing Apple shares up about 3 percent on Wednesday, to $267.25.

Analysts said the number demonstrated that Apple remained a fierce contender in the smartphone industry, despite competition from hardware manufacturers like Motorola and HTC and from Google’s Android phone software.

“It shows the Apple magic is still present,” said Gerry Purdy, a mobile analyst at MobileTrax. “It’s impressive.”

Still, analysts said, Apple is struggling to maintain the same clear-cut lead over rivals that it had in the past. In particular, the growing portfolio of Android-powered phones, which number in the dozens this year and are offered by many companies, is a significant threat.

“The reality is that in the long term, the Android market share is going to catch up to Apple,” said Charles Golvin, a wireless analyst at Forrester Research. “When you have one device being sold to a smaller portion of the population, it’s not going to compete as well as many devices from many vendors on multiple carriers.”

Mr. Golvin said that the slimmer design of the iPhone 4 and features like a higher-quality display and front-facing camera were helping to whip up interest in the phone, which will go on sale next Thursday.

But he also said that many current iPhone owners were probably nearing the end of their two-year contract with AT&T, qualifying them for a discount on the iPhone 4. “I doubt that a meaningful percentage of these buyers are new,” he said.

Either way, Mr. Golvin said, the 600,000 figure was good news for AT&T, Apple’s wireless partner in the United States. Most iPhone buyers are extending their contracts, he said, “so AT&T is securing an ongoing relationship with them for one to two more years.”

AT&T said Wednesday that the demand for the phone had forced it to temporarily suspend new orders.

“The availability of additional inventory will determine if we can resume taking preorders,” said Mark Siegel, an AT&T spokesman.

Mr. Siegel said it had handled 10 times as many preorders for the iPhone 4 than it had on the first day the iPhone 3GS was available for ordering last June.

Although Apple is still accepting preorders, its Web site no longer promises delivery on the phone’s scheduled release date. Instead, customers who place an order now may receive their phones by July 14.

The sales report led some experts to estimate that Apple would beat sales records for previous versions of the iPhone.

In a note to clients on Wednesday, Gene Munster, an analyst with Piper Jaffray, noted that it took Apple three days to sell a million of the iPhone 3GS. Mr. Munster said his firm was raising his estimate for sales of all iPhone models in the current quarter to 9.5 million, from 8.5 million.