Did Apple Manufacture a First-Day iPhone Shortage? 42 comments
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There’s nothing like scarcity to make you want something more. Apple (AAPL) understands this, which is why it tightly controls how many iPhones are available at any given time. Some anecdotal evidence is coming in that its partner AT&T (T) is selling out of iPhones in some of its own stores before Apple stores.
By noon ET today, for instance, at least ten AT&T stores in New York City were sold out of iPhones. Our own CrunchGear editor John Biggs was turned away from an AT&T store in Brooklyn after waiting in line for hours and was devastated (see his bittersweet video where he asks, “Am I a person, AT&T and Apple? What if I was pregnant?”).
None of this is too surprising since Apple stores are bigger and can carry more phones in stock. But is Apple artificially limiting how many phones each AT&T store can sell today? One angry reader, Mark Feldman, suggests as much, detailing his ordeal today at an AT&T store in Waltham, Massachusetts. Excerpt:
The manager got up in front of everybody and asked who was here for an iPhone. He then went on to explain that the store was only able to take orders for iPhones that would be delivered to the store in the next 5-7 days. They would take our money and when the iPhones came in we would get a call to come in and pick them up. If they were not picked up in a week, they would be shipped back and the charges reversed. He also said — and this was the kicker – that he had more iPhones in stock but he could not start selling them until Saturday morning due to his contract with Apple! And those would be on a first come, first served basis. In other words, Apple had manufactured a sell out of iPhones for the first day so as to generate “every store sold out of iPhones” [hype].
It’s one thing to actually sell out of your product. It’s another thing to manufacture a sell out of your product.
I am pissed at Apple for taking me for granted! I loved my iPhone and was willing to shell out several hundred dollars for a 3G on Day 1. I feel used. Like a chump who was turned away so Apple could get a nice sound byte on the news and the Blogs. I am so angry that I am planning to vote with my wallet… I am going to wait and buy the BlackBerry Bold which is coming out next month.
(You can read Feldman’s entire e-mail at CrunchGear).
The artificial shortage theory would hold more water if Apple’s own stores started “running out” of iPhones as well. An alternative theory, assuming that this hold-back policy is effective in other AT&T stores besides the one in Waltham, is that Apple wanted to drive more first-day customers to its own stores where it could control the launch better. The problem, though, wasn’t in the stores, it was when everyone tried to update their iPhone software at once, and found themselves holding a brick instead.
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This article has 42 comments:
But then again, the only relevant fact is that Apple is selling a ton of phones globally.
Certainly, the ATT stores had far fewer iPhones. To control the launch? Illogical. You've got a flood of people at whatever time the stores open, no matter how many the stores have. If the systems can handle the initial crush, which lasted at least a couple of hours, they can handle the same thing all day long.
Quite simply, Apple makes more money on iPhones sold at its stores. And there are far more ATT stores out there.
Move along, people, there's nothing to see here.
Apple will sale at least 15 million of these things in 2008 and as much as 8 million this Christmas. Next year will be off the charts with north of 35+ million sold. Getting any higher will depend on the success of RIMMS, Samsung and Nokia's new offerings. I suspect they will be have very competitive products.
Disagree - To give a specific number of phones to AT&T and have them contract for a certain number to be released on certain days allows Apple to predict future orders and maintain knowledge of present and future inventory.
People who wait in line for the experience have to go with the flow. To expect everything to work perfectly is naive and totally unrealistic. That is why many people wait until the kinks have been worked out and buy and will buy in the coming weeks and months.
There will be lots of RIM Bold for him whenever it becomes available, because no one else will want one (since they would all have the iphone).
That was a typo ....... he meant $220
Doesn't seem they're holding back at all.
When has RIMM done this recently? Nokia? Anyone?
I can't stomach the fact that these 'journalists' don't give Apple the benefit of a doubt. Most companies are honest. Many 'journalists' are somewhat less.
Nah.
Instead, RIMM's servers can be down for a day and it's a trivial matter. And that's not even from selling near 1 million phones...
Just one little example....the battery that you have to pay someone to switch out in the iphone...what a load of crap, all designed to make you pay more.
Just one little example....the battery that you have to pay someone to switch out in the iphone...what a load of crap, all designed to make you pay more.
From reports I got some ATT stores may have had a small hold back for Saturday morning. Many people have jobs and can't stand in a line all morning, thus it would be reasonable that a handful of phones would be available Saturday morning.
Fried from Little Rock went store to store to store Friday morning. First store he waited in line for, ,they announced white iPhone was all that was left. He was not having that, and went to a couple other stores - they were sold out,then found one with phones, but line was super-long. He decided to go to the office and check back at lunch but that store ran out, and he was told all ATT stores in the vicinity had run out. He was informed that they might get some in that evening, and to check back when store opens in the morning. He did, but were gone. rent-a-cop informed him that iPhones were gone right after doors were opened. Asked lady inside when more were coming, and she told him possibly next week, she wasn't certain.
Pretty much every ATT store nationwide had run out mid-day. If there were still a few phones being held, back, they would have been gone 30 minutes later. Still would have sold out.
What would Apple & AT&T rather have - a sound byte and hype or sales. What this guy is implying is that Apple rather have buzz that actual dollars, that revenues and profits aren't important to Apple. Who in there right mind would sit on inventory All day long when they could be selling it? I'm sure AT&T isn't concerned about earning sales commissions and hitting big revenue numbers, yeah right. AT&T would never go along and be told not to sell phones when there is huge line outside the door. If Apple had demanded that, I'm sure management at AT&T would have an array of four letter words for Steve Jobs. They are in the business to sell phones and contracts. AT&T is not a PR or marketing firm working to enhance Apple's appeal. Common sense. What;s next, the tooth fairy??
The idea that AT&T was sitting on any meaningful amount of
Every time I read it (and I still can't believe my eyes), it strikes me as more and more juvenile, snarky, and sophmoric.
Where, oh where, is 'journalistic' decorum?
nothing worse than a lying store manager
"A UPS man rolled in at around 11 AM with another shipment of phones, however, employees said that their system does not allow them to sell phones that arrive the same day. “We can’t sell the phones that arrive today, today,” she said. “We have to hold them for tomorrow.”
See: carlsbadistan dot com/?p=2867
Now if you think you can tell Apple exactly how many phones it will sell in each of the thousands of stores world wide on the opening weekend, then I think you have a great job opportunity.
Two, it's quite possible that Apple wanted the AT&T store to have stock on its first two days, limiting sales on Day 1 in order to have some stock on Day 2. Perhaps, the store was scheduled for a new shipment on Day 3. That way the store has inventory every day.
During the initial rollout, Apple was restocking Apple stores on a daily basis. But with AT&T's many smaller stores, it may be on a less frequent basis. Also, the phones may actually have to go thru an AT&T warehouse first, and then get distributed, requiring more time between shipments. Plenty of possible reasons for how things get distributed.