Analysts had estimated that AT&T and Apple would sell and activate 500,000 iPhones before AT&T’s earnings report was released yesterday.
AT&T says they only activated 146,000—and Apple is expected to release their sales numbers today. Could they be as high as 300,000? Did half of their customers buy a phone that they didn’t activate? Seems unlikely.
Too bad for Apple… Their shares are down 6%.
From the Chicago Tribune:
CIBC World Markets said that demand for the iPhone has had a “significant decline” in the past 10 days and that Apple and AT&T might try to boost demand by increasing their marketing efforts. Apple introduced the iPhone in the U.S. on June 29.
“We have noticed decent inventories at stores and thin demand at best,” CIBC analyst Ittai Kidron wrote in a note. “Among the stores we visited, most visitors were not looking at the device, and only a very small subset bought it.”
We’re less than shocked that a phone that costs $2,000 (all told) didn’t sell 500,000 units. Those numbers were just silly. It’s simply too expensive. 146,000 seems like a great success from where we’re standing. As an analyst told USA Today: “We became victims of our own hype.”
Shares fall on soft demand for iPhone [Chicago Tribune]
(Photo:hanapbuhay)
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@freakystyley
actually the iPhone was recently hacked through the safari browser giving complete access to the phone and it’s contents, including all personal data. I’m sure it’ll be fixed but just saying…
The official numbers were released by Apple today. They sold 270,000 phones in the first two days. Now that’s not 48 hours, that’s in the first 30 hours it was on sale. They sold 2 phones every second for the first 30 hours. That is PHENOMENAL. They expect to hit the 1 million mark by the end of 4th fiscal quarter, which of Apple is on September 30. That would make it the fastest selling phone of all time. I think that is quite a success story.
Marketing is not the issue — it’s the foolish total cost of owning the phone and AT&T’s piss-poor service.
@markwm: I can buy an unlocked (older) Blackberry for $90 online. No contract attached, hence no sky-high TCO for the phone. If I want to operate it, obviously, I’ll be paying some money — but because the service contract isn’t bundled, I don’t need to pay it as part of the phone. (Also, being able to use any provider who will give me a SIM means I can get much cheaper service than the cheaper plan available for an iPhone). (Also, I’d be much more inclined to pay for the phone if I could take it with me to a smaller telco like Cricket — but they’re CDMA, so not much chance of that; maybe in five years, if Google’s lobbying efforts are successful).
Me, I want an iPhone — but the 2-year contract makes it just too expensive. (With my wife getting ready to go back to school, the $600 hurts too).
People keep saying that iPhones “really” cost over $2000. So, I wonder what a non-iPhone “really” costs.
Verizonwireless.com offers a basic data plan for $79.99 month. A “nice” phone, the Motorola Q, is sold for $180 after rebate. Thus, a “real” cost of $180+24*80 = $2100 ($87/mo)
The iPhone is $499 for the low end model plus basic data plan at $59.99. So, $500+60*24 = $1940 ($80/mo)
Is it me, or is the iPhone cheaper than the competitor’s phone that actually has less memory and a smaller feature set? More megapixels on the camera, more pixels on the screen, finer dot pitch, longer battery, 4.0000GB vs 0.0625GB, etc.
I’m glad I bought lots of AAPL after the whole “only 150,000 registrations” and the big “panic.” It was on the market for 30 hours and people were expecting half a million? After hours, AAPL is up over 15; giving me enough money to pay for two iPhones (including the above “real cost”).
Anyone know how much Apple blew on marketing this thing? I know it has to be up there.
@Charles Duffy:
Yes, _you_ could do that. However, the average phone user would not do that. The typical phone user wants a brand new phone as cheaply as possible, and is willing to sign a two year contract. The person who is happy with an older Blackberry is not Apple’s target market. Their target market is the person who wants to be on the bleeding edge of technology and is willing to spend the money for it. This is the person generally unconcerned with signing a contract, so the TOC becomes a moot point, and to continue mentioning it is disingenuous.
Add to that that the rate plan for the iPhone, including the data connection, is actually cheaper than most data rate plans out there for comparable devices.
And remember, this is coming from an Apple hater.
Apple stock rose today more than it “plummeted” yesterday.
Will we see a “Apple stock skyrockets” post today?
AAPL up 5.4% on the day. I’d say they’re doing fairly well.
2 biggest issues with the iPhone are obvious.
1 – High Price
2 – Forced to use and sign a contract with AT&T
I still think the amount they did manage to sell and activate is quite impressive.
i could be misaken, but i actually read that apple’s stock went UP…
…due to excellent sales overall…