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Should Apple and AT&T Have Made the 3G iPhone Internet Order Only?

Posted July 12, 2008 6:32 AM by Gregory Ng
Categories: Opinions 

The blogosphere was buzzing yesterday as thousands of 3G iPhone owners struggled to activate them in store and at home. As every new iPhone user on the East Coast began activating their phones all at 8:00 AM EST, the AT&T computers started to lag.

I was the 4th person in line at my store and the AT&T employee who helped me out began activating my phone at 8:04 AM. Even then, there was a lag. I can’t even imagine how bad it got a few hours later.

It could be argued that there is no way around this problem. Apple has no choice but to release these phones at the same time everywhere. And AT&T has no choice but to force activation on the spot. And with iPhone releases like this only coming once a year (at best), there is no financial rationale for AT&T to boost infrastructure to their activation network.

But what seems to be the worst part of this process is Apple’s decision to sell and activate these phones in the Apple Store. I went into 2 Apple stores in the area as late at wednesday and every one I spoke with said they had been given no training on activating phones. Even if Apple store employees were trained thursday night, there is no way they can be comfortable enough with the process of activation and the onslaught of waiting customers.

The AT&T store I was at had many sales people asking for help from their managers when activating the phones. And these people activate phones for a living. What is most concerning is that Apple stores started directing customers to bring their sealed iPhones home and activate at home. Wait. Wasn’t that the big news that they were not able to activate at home?

Which brings me to my latest idea. What if Apple and AT&T made the iPhone internet-order only? That way everyone could sign up and AT&T could ship out activated phones on a rolling basis. A “backordered” message seems much more palatable to a customer than a “You cannot activate” message. This process will obviously be good for activation flow and supply chain. But it will also eliminate long lines and camp outs which only helps Apple’s brand.

What do you think?

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Comments

  1. As a west coaster who was 40th in line, let me tell you the lag was so bad on the west coast that I didn’t even get in the store until around 11 AM.  Did I mention I was only#40 in line, out of about 250-300?  iPhone Retail VP publicly stated earlier this week that they would be handling 100 customers per hour.  What a frickin’ farce.

    As far as backorded by mail.  No way.  For those of us who just had to have one in hand yesterday, at least by the end of a very long day they had a working phone.  When I finally got home at 1:30, no issues activating on iTunes (our store ended up just sending you on the way with your phone starting around 9:00 AM with the first group of 20 they let in - makes me wonder why the line still moved so slow after that).

    Posted by DistortedLoop on July 12, 2008 10:06 AM

  2. What a joke!.  Apple and AT&T really blew this one.  I waited in line for two hours at a nearby AT&T store on Saturday. There were probably 50 to 60 people in front of me. The line moved 12 feet in 2 hours.  It literally look them that long to process roughly a dozen people. Pathetic!

    I finally left shortly after 2 hours and moving 12 feet, along with about 20 other people,  after a AT&T employee came out and told us how many iPhones they had available (not enough to cover to cover all in line).

    Apple and AT&T really screwed this up big time. What an incompetent plan this was.  Whom ever is responsible needs to be fired!

    Posted by Paul on July 12, 2008 9:17 PM

  3. They hardly blew it.  Some people had trouble on Friday, most people were working at their jobs.  By Friday afternoon everything was resolved and has been working fine since.

    Posted by mm on July 12, 2008 10:11 PM

  4. AT&T did a lousy job. I was about the 50th in line and was not able to get a phone after 4 hours and the person they had working the crowd gave little to no information. People were also sneaking into line with their friends and they did not have enough phones. Anyone at AT&T pay attention last year?

    Then I waited at an Apple store for 4 more hours, and when I finally made it to the phone the guy ran my info and said I could not buy the phone there. I had to go to an AT&T store which had no phones. I’m not a business customer so don’t know why that happened. At least Apple was passing out water and donuts. AT&T could care less if you passed out from heat stroke.

    Called AT&T customer service and they had no clue why i couldn’t buy the phone at apple.  For a communications company they communicate poorly.

    Posted by jd on July 12, 2008 10:51 PM

  5. @mm -  you hiding in a cave someplace, or what?  Check around the blogosphere, all kinds of reports of no phones, people being turned away, LONG LINES all across the country, still.

    I personally saw an Apple Store line approximately 60-75 people long this afternoon that only moved half the people through it in about 2 hours.

    Yes, they blew it.  Apple blew it by caving in to AT&T demands for this ridiculous in-store activation process, and AT&T blew it by demanding it in the first place.  Apple blew it by pushing the 2.0 software (which requires re-activation via iTunes) to the old phones concurrently with the release of the new phones that also require activation via iTunes. 

    Neither company learned a thing from last year’s crush on the system the iPhone placed the first weekend.

    Posted by DistortedLoop on July 13, 2008 12:42 AM

  6. As a former Apple retail employee, I can tell you that the decision to activate in-store was not Apple’s.  AT&T is the company that loses the most if the phones are not activated on their network.  Apple gains market share with every phone sold.  Apple does not care what network that phone is on.  Guaranteed.  AT&T saw a huge jump in new subscribers with the first iPhone at $600.  Imagine how many new customers they get at $199.  But to get the price that low, it had to be subsidized and with that subsidy comes restrictions - in-store activation.  Period.

    Posted by Damonic on July 13, 2008 2:14 PM

  7. From a business stand point mistakes were or are being made.  Does anyone really care who’s to blame?  Apple needs to work this out with their exclusive “partner” AT&T.  Anytime you have a clients feeling cut out or disenfranchised you’ve got a problem.  People are lining up to buy the product, but you don’t make enough product available.  Hmmmm.  So they line up again the next day.  Great for headlines!  Did you see the newspaper, CNN, the Times, etc?  “Wow, maybe i should get an iPhone too if all those people want one that bad!??”

    Blogs like this are a great place for rants and raves, but if you want something to actually happen send Steve Jobs office an email, and send the customer service team at Apple a cc: along with a link to all the different complaints about their distribution failures.  Not sure what that will accomplish, but it’s more productive than posting here. 

    Selling from scarcity is a sales tactic that all companies use to increase demand, and make clients feel lucky that they “got one”.  Just look at the Nintendo Wii, you still can’t get that system at any of the Big Box stores, or other retail outlets, they’re always sold out.  That’s cuz the manufacturer only trickles a little out at a time. 

    I’m not saying that Apple for sure is doing this on purpose, but they knew that demand would be high, and in traditional Apple fashion they hyped up the new iPhone 3G.

    Posted by Ruben Leon on July 15, 2008 3:26 PM

  8. WHAT DOES ANYONE THINK WHEN YOU HAVE THE WHOLE WORLD ACTIVATING THESE PHONES ... REALLY PEOPLE ...THINK ABOUT THIS…...DERRRRRRRRRR

    Posted by no name on July 20, 2008 2:05 PM

  9. What chapped my ass was that I stood in line for over 3 hours on the 12th at an Apple store, only to learn that since I have my cell bundled with AT&T broadband and my land-line, that Apple couldn’t do the upgrade.  WTF???  I had to go to an AT&T store, they were all out, so I placed an order which, 10+ days later is still backordered.

    Note to AT&T - you guys pushed me to bundle my services - you could have at least made it clear as day that if you bundle, you can’t get an iPhone at an Apple Store!

    Posted by Bill on July 23, 2008 9:47 AM

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