Apple 3G iPhone and Today's Perfect Storm

Unless you've been hibernating, you probably know today was the day Apple began selling their new 3G iPhone all around the world. The momentum had been building for months, but with tens of thousands all buying and activating their phone within several hours of each other, could anyone know how smooth it would go?

I got to the San Diego UTC store at 7 am, but my wait-in-line person I hired off of Craig's List was there at 4:30 am and was #25 in line. The first person in line arrived 5:30 pm the night before, and at the time of the doors opening there were 200 people in line behind me.

The first signs were positive. Apple employees brought bottled water and coffee to those in line. Seems like they had prepared for the onslaught. I got in at about 8:20 am
and was greeted by Erik who seemed eager to help. He took down my account information on his handheld computer that connected to AT&T's. But in spite of several attempts, AT&T's computer would not approve my upgrade to the 3G phone from a year old iPhone. Erik shuffled me off to their experts that were there to help with AT&T issues and introduced me to David R. He called AT&T and got right through, signs that my luck might be changing.

After an hour on the phone with Tracy, a very nice AT&T supervisor, she was able to close one account, set up a new one and give me a new customer ID to get their system to be kind enough to sell me the phone.

The next step was activation, a short step where the phone is connected to a computer and to the itunes store to be registered and turned on. But Apple's servers were experiencing outages, and the normal process was taking about an hour instead of 3 minutes. I took the iPhone home to complete the activation later that day. That went like a breeze; everything on my old phone synched to the new one, including my contacts, calendar, songs, podcasts, photos, and even my home screen.

What's the lesson here? Don't be an early adapter like me, wait a few days. Apple and AT&T's faulty preparation was mitigated somewhat by their personnel, who were amazing. In spite of all the glitches that many like me had. They were patient, never rushing, and taking their time to be sure everything could be done to get the phone working. That attitude seemed to be infectious as most of the people in the store seemed to take everything in stride. Of course this is laid back San Diego and who would think otherwise?

But I doubt those outside the store, more than 400 by the time I left at 11 am, will be as happy. If the average time for a transaction continues to be 30 minutes. With about ten customers being handled at once that's a wait of 20 hours for some, assuming they don't run out of phones first. No one would say how many phones they had, but I counted 300 on their counter.

All during this time I was talking with my friend Larry on the East Coast and many of the problems were similar there. At an AT&T store in New Jersey there were 100 in line, but the store only had 30 iPhones to sell. And one salesperson told Larry that of the 10 phones he sold, 8 were new customers, and, get this, 6 of the 8 were existing Verizon customers!

Comments

[Rule Of Law]

3G iPhone: 'Another Extraordinary Launch' for Apple
Posted Jul 14, 2008 04:32pm EDT by Aaron Task in Investing, Electronics, Products and Trends
Related: AAPL, RIMM, SNCR, BRCM, NOK, T, PALM

Activation problems? What activation problems?

Swatting aside concerns about activation issues -- ironically because of its iTunes software -- Apple announced Monday that it had sold 1 million 3G iphones over the weekend, exceeding the most optimistic expectations. Apple shares were higher in a tough tape Monday afternoon.

This was "another extraordinary launch" for Apple, says Henry Blodget, who believes Apple's success is largely coming at Research In Motion's expense.

[mkelch]

Our telecom industry is a mess. Like the airlines, I keep thinking that one day they'll get better, but they never do. Mr. Baker's experience is just another example. Even if all had gone smoothly, there is still the matter of "dead zones" poor connections, lost connections and billing practices that no one can understand. This competitive free for all has created another huge mess, while users in Japan, Europe and China have standardized systems that are consistent and reliable. The difference begins with special interest groups in Washington who favor their own systems over their competitors. The same chaos exists in our medical industry which is a conglomeration of systems that cannot communicate with one another which increases the costs of healthcare as much as 35%. Our federal governments is so influence by special corporate interests that they cannot even set simple standards that would benefit everyone.

[IndependentMeans]

We had the day off and went to our closest ATT in Placerville CA. It was awful. We got there with maybe 50 people ahead in line, they only received 20 phones for a line of about 200. In Folsom CA they received 50 phones for a line of 400. I am amazed at anyone claiming this was smoothly. You were the rare exception. I spoke with Apple and ATT, all claiming there would be lines and chaos. I had no intention of spending hours in line or paying someone else to do so. What I am livid at, Apple and ATT, was the small amount of phones available. There was no excuse. Now we have to drive back again when the phone arrives, another one hour drive. I think APPLE's preparation was a joke. ATT was worse. Nice to live in San Diego where you were treated kindly in line, we were in 100 degree weather, and no one gave a shit. There certainly were not handing out water.

[95flhtcu]

IT has always intrigued me why anyone would waiit in line for a phone. They'll be there tomorrow, an next month. Can someone tell me what drives one to stand in line for hours for something there is no shortage of? (This is a serious question)

[theJuanStar]

I waited in line for about 4 hours at an AT&T store in Philadelphia. I had expectations of there being high traffic on the iTunes servers, so I was not surprised at the in store delays. I was surprised at well Apple and AT&T handled this roll out. The two companies should be commended for what I consider a fantastic unveiling. The service that went into to the day is beyond compare! I do agree that releasing the 2.0 firmware update for existing customers days prior would have alleviated this issue. I had the 1st generation iPhone and have been quite pleased. The price slash for a faster model with twice the space propelled me to be one of the first to get this device. I am quite satisfied with the experience and the iPhone.

P.S.- I would agree that $199 or $299 is a bit much to pay for a phone. But the thing is the iPhone is NOT a phone. It is a literally a computer with internet access that can make phone calls. The device is AMAZING. The new apps that have been developed show a promise of where the market is and should be headed.

[recruitgal]

I would like everyone to calm down - it's just a phone.

The battery on my MacBook has given up the ghost, but I can't go to my local Apple Store to have it replaced because of the crowds of iPhone wannabes causing chaos in Regents Street in London.

Mac products are great, but a little perspective would be nice.

[GLS350]

Happliy my experience went rather smoothly, other than the 3 hour wait to set foot inside the store that is. I can't say the same for a few people around me however as they came in unaware of the fact that if you are ineligible for an upgrade from AT&T you have to pay $399 or $599 for the 8 and 16GB phones respectively. Needless to say they hopped right out of line when they found out. Unfortunately they had already been waiting at least 1.5 hours.

Now normally I'd just have waited a week or so for the crowds to die down, but I was so sick of my Verizon service (little to no reception around my house you see) that I committed to getting the switch to AT&T (which I've found has the best reception around my area) done at any cost. So far it's been worth it as Iove this phone.

[rubberneck]

My phone was bricked for an hour this morning. What a pain. Apple screwed up, and should have eased out the 2.0 firmware. Doing it all on the same day, coupled with the release of iTunes 7.7 and the new 3g phone was dumb. Lesson learned.

[oscarp]

I upgraded the software on my 2G iphone, so far, no problems. I did it last night, but I guess I followed instructions and everything went smoothly.

[KPinSEA]

Hey Apple, don't miss the market opportunity created by FISA.

Next killer app for iPhone: peer-to-peer strong encryption.

[Rule Of Law]

Could there have been a way to give this positive spin rather than negative? Couldn't the headline have as easily bee, "Apple goes extra mile to ensure product satisfactions!"

[NTO08]

Apple sucks...en­d of story...I pity the poor fools who waited on lines for this phone...am­azing how people have so much time on their hands to waste on a piece of plastic. It is sad, really...

[mapleman]

yeah and dell rules right?
gimme a break.