[CorpITGuy]

http://news.cnet.com/8301-17938_105-...g=2547-1_3-0-5

100/100 AT&T stores surveyed had no iPhone 3Gs in stock.

This has to be a production problem. NO WAY was Apple ready to go live with the iPhone 3G. I grow more discontent with Stevie J every single day.

[DigitalEl]

Originally Posted by CorpITGuy

This has to be a production problem.

More of an allocation problem. AT&T stores were mostly out of stock by 10 a.m. last Friday, while Apple Stores are just now running out. It looks like Cupertino was simply saving the bulk of the stock for themselves.

I started the morning at 6 a.m., 37th in line at the AT&T store at 1550 N Dysart Rd outside of Phoenix last week. They ran out of 16 GB iPhone 3Gs when I was 4 people back. I went to the nearest Apple Store, about 30 minutes away and there were 400 people in a line they estimated at about 5 hours. I said "F that" and went home.

After several hours, I couldn't stand it and went back. It was now about 6 p.m. I stood in line 'til about 11 and got my 2 phones. That Apple Store must've had thousands in stock. I don't think there's a production problem.

That being said, the whole thing could've been handled better. Apple gets off on the free pub which comes from lines stretching for city blocks. Handing out tickets and coming in later without the lines is much more customer friendly. Best Buy does it for console releases (at least they did here in my area) and Barnes & Noble does it for new Harry Potter books.

As long as we're willing to line up like lapdogs, shouldering our way into the Reality Distortion Field, Apple has no motivation to change its ways. I'm a longtime admitted Apple nerd, but last Friday's experience definitely left me a little soured. I love my phone, but feel silly for having jumped through their hoops to get it. Would I do it again? Who knows. Such is the nature of it all.

[Mastrap]

Originally Posted by CorpITGuy 

This has to be a production problem. NO WAY was Apple ready to go live with the iPhone 3G. I grow more discontent with Stevie J every single day.

Have you ever worked in manufacturing? Warehousing is expensive, and for an item such as the iPhone, risky. Apple sold 1 million iPhones over the first weekend of it being on offer, something it took the original iPhone 74 days to achieve. That's a massive logistical effort, especially when you average sales numbers will be much lower than the initial rush. You can't build a distribution channel to a capacity you'll only ever need for two weeks at the most, then let it lie under-utilized.

Apple is more than ready. There might be a shortage right now, but new phones are being distributed all the time.

[mduell]

It's a PR strategy... intentionally run out (but not for too long) and you can flog it is "amazing unexpected blah blah demand."

[Helmling]

Originally Posted by CorpITGuy 

http://news.cnet.com/8301-17938_105-...g=2547-1_3-0-5

100/100 AT&T stores surveyed had no iPhone 3Gs in stock.

This has to be a production problem. NO WAY was Apple ready to go live with the iPhone 3G. I grow more discontent with Stevie J every single day.

Buddy, sometimes with a hot product, you just can't make enough.

Look at that Wii thing. There are STILL shortages!

You remind me of this guy who came into my Babbage's store way back when the first Playstation came out. He was mad at me for not ordering enough. Like I wouldn't have had ten times as many in stock if there were any to have.

Go figure. It's called "scarcity" and it's a fundamental economic concept. Sorry.

[Simon]

It's actually quite simple. Apple has two options:

• ramp up production early on, manufacture a lot of warehouse stock and go on sale late to be able to satisfy initial demand -> expensive

• go on sale as soon as production has started; sell out quickly, generate lots of free PR hype, and save a lot of warehouse costs

From a business POV, why should Apple not go with option 2? A company with such a product and this kind of loyal customer base cannot go wrong with option 2. The shareholders will love it.

[CorpITGuy]

(1) The supply chain can be leased rather than built (purchased). In fact, that's the way Apple does it.
(2) There is no Wii shortage. It's an artificial shortage being caused by Nintendo, and it's BS.
(3) As a PP mentioned, Apple stores have stock. They clearly weren't prepared for the AT&T demand.
(4) If item #3 is true, and it is, Apple is failing miserably if they're trying to create a Wii-type shortage, since you can walk into over half of Apple's stores right now and buy an iPhone 3G.
(5) The idea of creating an artificial shortage might be smart, but it's terrible customer service.
(6) The lead time is only 7-14 days for a new iPhone. I just ordered one on my Premier account that will be here in 5 days. In other words, it's been manufactured, but Apple didn't get enough to the AT&T store locations.
(7) Maybe it ISN'T all Apple's fault -- maybe AT&T didn't order enough. They are idiots at AT&T, and we ALL know that....

My 2 cents... er, 7 cents.

[Mrjinglesusa]

Originally Posted by CorpITGuy 

(1) The supply chain can be leased rather than built (purchased). In fact, that's the way Apple does it.
(2) There is no Wii shortage. It's an artificial shortage being caused by Nintendo, and it's BS.
(3) As a PP mentioned, Apple stores have stock. They clearly weren't prepared for the AT&T demand.
(4) If item #3 is true, and it is, Apple is failing miserably if they're trying to create a Wii-type shortage, since you can walk into over half of Apple's stores right now and buy an iPhone 3G.
(5) The idea of creating an artificial shortage might be smart, but it's terrible customer service.
(6) The lead time is only 7-14 days for a new iPhone. I just ordered one on my Premier account that will be here in 5 days. In other words, it's been manufactured, but Apple didn't get enough to the AT&T store locations.
(7) Maybe it ISN'T all Apple's fault -- maybe AT&T didn't order enough. They are idiots at AT&T, and we ALL know that....

My 2 cents... er, 7 cents.

Your logic is fatally flawed and 3) is the stupidest thing I have ever heard. Weren't prepared for the AT&T demand? Seriously? Maybe, just maybe, Apple allocated 98% of their iPhone 3G stock to their OWN stores as opposed to AT&T stores. Do you think, possibly, that is why AT&T stores have no stock but Apple stores do? I know it sounds like a far off concept, but it's MUCH more believable than Apple not being "prepared" for the AT&T demand.

You clearly have no idea how business works or how Apple allocates iPhones to AT&T stores. I guarantee you that AT&T does not get to "order" XXX number of iPhone 3Gs from Apple. Apple sends them how ever many they want to send them. In this case, it makes much more sense for Apple to make sure their stores are stocked and then send a few iPhones to AT&T stores rather than vice versa.

[CorpITGuy]

Originally Posted by Mrjinglesusa 

Your logic is fatally flawed and 3) is the stupidest thing I have ever heard.

1. Stupidest thing you've ever heard? You've obviously never watched C-SPAN....
2. If AT&T has no say in how much inventory they receive, I suppose Apple could ship them (force them to purchase) a billion or so iPhones. What's wrong with that logic?
3. AT&T has MANY, MANY, MANY more stores than Apple. Apple doesn't even have a store in several states. They're losing sales.

In reality, there weren't enough iPhones in the channel at launch to accommodate for demand. This isn't an issue of scarcity, since the iPhone isn't truly a commodity. AT&T is the commodity here (they just don't realize it yet). Apple has either decided to be Nintendo (grrr) or they badly underestimated demand. As I demonstrated earlier, there's no reason for a shortage since everything from production, warehousing and delivery is leased.

[jeffhatz]

I was talking to someone at an AT&T store and he said AT&T themselves ordered too few and it was not Apple jipping them.

[dawho9]

Originally Posted by CorpITGuy 

(6) The lead time is only 7-14 days for a new iPhone. I just ordered one on my Premier account that will be here in 5 days. In other words, it's been manufactured, but Apple didn't get enough to the AT&T store locations.

The fact that you can walk into an ATT store today with a premier account and get it within 5 days tells me ATT has a bunch of them in stock and warehoused. What I remember reading somewhere is that ATT kept the bulk of them at the warehouse and intentionally only sent a small amount to the stores (there are lots of reason for this including them creating demand, reducing the risk of theft - remember iPhone 1.0 had lots of reported ATT theft from store employees.)

But than again, those are just my guesses.

dw9

[ghporter]

Originally Posted by mduell 

It's a PR strategy... intentionally run out (but not for too long) and you can flog it is "amazing unexpected blah blah demand."

Rather cynical, but not without cause. I would suggest that rather than being a strategy, it'll be USED by AT&T's and Apple's PR folks. Instead of being intentional, I think the suits based their "copious supply" on the original iPhone's numbers and "optimistically" padded their expectations by quite a bit. Not nearly enough, but that's how suits work... Planned undersupply gets one more "catch up" sales, but it also alienates customers, and has an overall negative effect in the near term. The suits aren't that stupid, even at AT&T.

[Mrjinglesusa]

Originally Posted by CorpITGuy 

1. Stupidest thing you've ever heard? You've obviously never watched C-SPAN....

OK, not the stupidest thing I ever heard but definitely one of the stupidest things I ever heard. The idea that Apple wasn't "prepared for the AT&T demand" is laughable. Apple is simply sending the majority of their iPhone stock to their OWN stores, rather than to AT&T stores. It's not a matter of who has more stores, it's a matter of this being Apple's product and them wanting THEIR stores to have stock of THEIR product.

It's an understatement to say that there weren't enough iPhones in the channel to accommodate for demand. There STILL aren't enough iPhones to accommodate the demand.

Originally Posted by CorpITGuy 

2. If AT&T has no say in how much inventory they receive, I suppose Apple could ship them (force them to purchase) a billion or so iPhones. What's wrong with that logic?

You can't be serious.