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Despite Some Glitches, 'Suits' Wait for Apple's iPhone 3G

Jennifer LeClaire, newsfactor.com

Long lines and activation delays marred Friday's debut of Apple's iPhone Applications. Carrier AT&T blamed Apple.

AT&T said in-store iPhone Applications activations stopped at about 9:30 a.m. Eastern time, thanks to issues with the iTunes 7.7 software needed to configure the device. AT&T is recommending that customers activate the smartphones at home. Some analysts are certain the problem is getting blown out of proportion.

"Today's discount new iPhone launch differs a little bit from last year because this is a global launch. This started in New Zealand and will continue on to California," said Michael Gartenberg, an analyst at JupiterResearch. "You literally have hundreds of thousands of people buying and activating iPhones. I am not surprised that we are seeing some issues with the activation process with some people in some locations. Frankly, that's probably to be expected."

Some Shortages Reported

Gartenberg visited both an AT&T store and an Apple store in New York City on Friday. He reported lines were moving along smoothly. However, an AT&T store in midtown ran out of the 16GB iPhone Applications as early as 9 a.m.

Whether consumers wound up disappointed with discount iPhone 3G shortages after waiting in line, perhaps all night, might depend on where they were standing in line and the luck of the draw.

"At the Apple store I visited, they said they had plenty of iPhones on hand and they were not anticipating shortages. Of course, they didn't know what the demand would be like the rest of the day," Gartenberg said. "They've been selling the new iPhone since 8 a.m. The line was going around the block."

The Good, the Bad and the Ugly

The lines of people around the block would seem to indicate Apple has scored another big hit. But reports of glitches could be a bit of an ugly memory for some consumers.

"Any time you have that many people pounding on the same servers trying to do the same thing at literally the same time, I expect you are going to see some issues," Gartenberg said. "I did see some people having some small problems, but I also saw literally more people buying their phone, getting out and going on to the next thing without any problems whatsoever. I expect that whatever problems will be addressed within hours and not days."

'Suits' Stand in Line

There has been a lot of attention to Apple's plan to grab a bigger share of the business market. Although we're weeks away from seeing hard numbers, Gartenberg reported anecdotal evidence that seemed to suggest an appetite for the iPhone 3G store among professionals.

"What was interesting at an AT&T store in the middle of midtown Manhattan was the number of business types that were out there. Men and women in full business attire were waiting in line. These are not the sort of people usually you'd see on day one of the launch," he said. "Many of these folks were checking their Blackberries as they apparently waited for their opportunity to get an iPhone. If that's indicative of any trend, that bodes well for Apple."

Source: http://news.yahoo.com/s/nf/20080711/tc_nf/60749

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