Business | Technology
New iPhone gets muted reception
Cost of services and online pre-ordering result in fewer customers queuing at stores.
- By Alex Pham and Michelle Maltais, Los Angeles Times-Washington Post News Service
- Published: 19:12 June 20, 2009
- Image Credit: Bloomberg News
Los Angeles: To true believers, the iPhone is not just another phone.
"It's a device that does everything in my life," said Vartan Nadjaryan, who already has an iPhone but still showed up at an AT&T store in Glendale, Los Angeles, at 3.30am on Friday to be among the first to get his hands on the latest incarnation of Apple Inc's popular touch-screen device, the iPhone 3G S.
Nadjaryan, 20, was among thousands of people who queued up on Friday to buy the device, which costs between $199 (Dh730) and $299 for new AT&T subscribers and current subscribers who are eligible for an upgraded phone.
Since introducing the original iPhone in 2007, Apple has snagged a significant chunk of the market for smart phones, a category of high-end cell phones that also lets users take pictures, play videos, access the internet or play games.
In 2008, the Cupertino-based company sold 13.7 million iPhones worldwide, capturing 8.4 per cent of the smart phone market, said Tina Teng, an analyst with research company iSuppli Corp in El Segundo.
But while throngs of people lined up for hours for the first- and second-generation iPhones, Friday's launch of the iPhone 3G S was relatively subdued. At the AT&T store where Nadjaryan went, about 15 customers were waiting when the store opened at 7am. But a mile away at the Apple store in Glendale Galleria, about 200 had shown up by the same time.
The spotty reception may have to do with the ability of buyers to pre-order the phone online on Thursday, rather than standing in line to get one, said Teng.
Another factor that may dampen demand is the cost of the service, Teng said. The least expensive AT&T plan that includes text messaging and data service would run in excess of $100, including tax.
"That can put a cap on their growth," said Teng, who estimates that Apple will sell 18.7 million iPhones this year for a 10 per cent share of the market.
For some, the problem wasn't in getting the phone; it was getting it to work. Because of the crush of new phones coming online within a short period of time, some customers waited hours for their phones to be activated. Customers who called Apple's customer service line were informed of a possible two- to three-hour delay in getting phone service for their new devices.
Nadjaryan said he had to reboot his iPhone 3G S three times before it connected. But, he said, "It's well worth it."
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