iPhone to be available at 2000 store fronts on launch

[AppleInsider]

Apple's inaugural mobile handset, iPhone, will be available for sale at 2000 retail store fronts when it goes on sale for the first time next month, putting the device within reach of most US households.

That's just one of the info morsels Bear Stearns analyst Andy Neff came bearing after a meeting with members of Apple's executive team on Wednesday.

During the sit-down, Apple retail chief Ron Johnson and Director of Mac Product Marketing Tom Boger informed the analyst that those store fronts would consist exclusively of Apple and AT&T retail stores. (That breaks down to approximately 160 U.S.-based Apple outlets and roughly 1840 AT&T wireless boutiques.)

"Apple affirmed its goal of June release for iPhone and expressed confidence in meeting its target of 10 million unit shipments in 2008 given iPhone's superior user experience, which Apple referred to as 'transformational,'" Neff wrote in a summary of his discussions.

He added that, in addition to iPhone’s revolutionary touch interface and intuitive software capabilities, Apple is focused on differentiating iPhone from the rest of the pack by improving every facet of its user experience, including at the point of sale.

In regards to its retail store initiatives, Apple noted that it currently operates 181 stores worldwide (161 in US and 20 international) and will continue to expand its store presence, although at a measured pace that will be based on the availability of key real estate locations.

"In addition, for international store openings, Apple noted that its strategy is to focus on regions with high Apple installed base first (i.e., Japan, UK, etc.) and then expand to other regions," wrote Neff. "As part of its multichannel strategy, Apple noted that it is expanding its store-within-store (staffed by Apple employees) at Best Buy from 50 to 200 as Apple sees it as another way to reach its customers."

While there are concerns about potential execution issues resulting from Apple's rapid growth and broadening product portfolio, the Bear Stearns analyst said it appears to him that the company is managing its growth by leveraging resources across the company. For example, he said, the company has adopted the Leopard operating system for iPhone as well as Macs, which minimizes the strain on resources.

The Cupertino-based firm has laid out a "very selective" product roadmap, he added, with a particular emphasis on the timing of introductions and what products it has decided not to pursue. In fact, the analyst said, Apple noted that the coordination and close cooperation between different groups enable the company to provide superior user experience to customers.

Neff, who is maintaining all of his current estimates on Apple, holds an "Outperform" rating on shares of the company with a price target of $143 per share. His meeting with Apple executives follows a similar sit-down between UBS analyst Ben Reitzes and other members of the Apple's leadership earlier in the month.

[ View this article at AppleInsider.com ]

[solipsism]

Originally Posted by Andy Neff

In addition, for international store openings, Apple noted that its strategy is to focus on regions with high Apple installed base first (i.e., Japan, UK, etc.) and then expand to other regions...

I thought Apple had a poor installed base in Japan.

[EagerDragon]

Not sure about expanding to areas with large Apple customer base. Looks more like expanding to areas where there is a large potential for new cusatomers. Which is what I would expect anyone to do.

With an install base of around 5 percent, I am not sure that there is a large install base anywhere.

Yes, I get the point.

[TednDi]

" For example, he said, the company has adopted the Leopard operating system for iPhone as well as Macs, which minimizes the strain on resources."

so, if leopard is in the iphone then multitouch is in leopard......

interesting!

[Wings]

Not to nit-pick or anything, but....

"Apple affirmed its goal of June release for iPhone and expressed confidence in meeting its target of 10 million unit shipments in 2008 given iPhone's superior user experience, which Apple referred to as 'transformational,'" Neff wrote in a summary of his discussions.

It isn't Apple's goal to ship 10 million IN 2008, but BY THE END OF 2008. If anyone is going to move the goal posts, these analysts & tech writers should let Apple do it themselves. Come Dec 31, 2008 I can almost expect these same writers to scream that Apple failed to meet it mark when the totals for 2008 come in under 10 mil, even though the grand total may be much higher.

[Gee4orce]

The 'install base' is referring to the countries that have a large MOBILE PHONE install base, not Mac/Apple/iPod install base. These are clearly the best places to try and sell a new mobile phone into...

[JupiterOne]

Originally Posted by AppleInsider

Apple's inaugural mobile handset, iPhone, will be available for sale at 2000 retail store fronts when it goes on sale for the first time next month, putting the device within reach of most US households.

Yeah, but how many phones will actually be available in each of these locations.

[kenaustus]

Originally Posted by JupiterOne

Yeah, but how many phones will actually be available in each of these locations.

It will probably depend on the store's sales levels and location. I would expect the Apple Stores to have at least 100, with the larger stores (like in NY) having significantly more. Apple will probably refresh the stores rapidly "while supplies last", using overnight if needed. ATT will probably take the same approach.

That will maximize sales, but I still expect backorders to build rather fast. I'm looking for long lines outside of some of the Apple Store on the first day of sales.

[ThunkDifferent.com]

Great update. I'm unclear how they are going to offer 2000 however. Even with all the retail, store-within-a-store and Best Buy - do you think 2000 is realistic? I must be missing something. However, i'm looking forward to such a big launch this product is starting to very "2000."

Comment NOTE: I too thought that Apple had a poor user base in Japan.

[solipsism]

Originally Posted by ThunkDifferent.com

Great update. I'm unclear how they are going to offer 2000 however. Even with all the retail, store-within-a-store and Best Buy - do you think 2000 is realistic? I must be missing something. However, i'm looking forward to such a big launch this product is starting to very "2000."

Comment NOTE: I too thought that Apple had a poor user base in Japan.

1) In a previous AI article or TUAW blog, I believe it was mentioned that Best Buy's AT&T cell phone centers will not be getting any iPhones. At least, not off the bat.

2) I did some checking, the first Apple store opened out the the US was in Japan at the end of 2003. The currently have 7 stores. The 3rd largest number after the UK's current 9 and the US' 160 retail stores. I speculate that if we see additional stores opening in Japan that an ulta-portable may be around the corner*.



* Yes, I pulled that idea out of my ass.

[JupiterOne]

Originally Posted by ThunkDifferent.com

Even with all the retail, store-within-a-store and Best Buy - do you think 2000 is realistic?

Totally realistic.....for the first 10 minutes the stores are open.

[BRussell]

Originally Posted by Wings

Not to nit-pick or anything, but....

"Apple affirmed its goal of June release for iPhone and expressed confidence in meeting its target of 10 million unit shipments in 2008 given iPhone's superior user experience, which Apple referred to as 'transformational,'" Neff wrote in a summary of his discussions.

It isn't Apple's goal to ship 10 million IN 2008, but BY THE END OF 2008. If anyone is going to move the goal posts, these analysts & tech writers should let Apple do it themselves. Come Dec 31, 2008 I can almost expect these same writers to scream that Apple failed to meet it mark when the totals for 2008 come in under 10 mil, even though the grand total may be much higher.

I think they just meant that the target was in 2008, not that all of the sales would occur in 2008.

[nvidia2008]

I bear offerings of silk and spices from the Orient if someone can ship me the first iPhone.

[webmail]

Where you not aware of this already? Apple clearly stated the delay for the iPhone was due to the Leopard team. It's a compact version of Leopard, and the multi-touch stuff is probably specifically for the iPhone. However something like multi-touch will probably show up in other Apple products.

Originally Posted by TednDi

" For example, he said, the company has adopted the Leopard operating system for iPhone as well as Macs, which minimizes the strain on resources."

so, if leopard is in the iphone then multitouch is in leopard......

interesting!

[OS2Guy]

Hey, I'm a block from Apple's San Francisco downtown store and I'm reading here that Apple will be selling the iPhone themselves. I've waited for this opportunity since last September when T-Mobile asked me to resign another year's contract (I declined and now pay a hefty month by month fee). I want to keep my phone number and hope the Apple Store employee is ready to make that transfer.

So how early should I get to the downtown store? I get to work at 7am and the Apple Store doesn't open until 10am. What do you think? Should I go there directly on the announcement of sales day instead of the office or go even earlier? I suspect the lines in downtown SF will be pretty long.

Advice please.

[ebrunn]

Originally Posted by OS2Guy

Hey, I'm a block from Apple's San Francisco downtown store and I'm reading here that Apple will be selling the iPhone themselves. I've waited for this opportunity since last September when T-Mobile asked me to resign another year's contract (I declined and now pay a hefty month by month fee). I want to keep my phone number and hope the Apple Store employee is ready to make that transfer.

So how early should I get to the downtown store? I get to work at 7am and the Apple Store doesn't open until 10am. What do you think? Should I go there directly on the announcement of sales day instead of the office or go even earlier? I suspect the lines in downtown SF will be pretty long.

Advice please.

They will almost forsure be a huge line by then. You better call in sick that day.

[anantksundaram]

Originally Posted by ebrunn

They will almost forsure be a huge line by then. You better call in sick that day.

Hmmmm..... why not just order thru Apple's online store and save yourself the hassle? (Unless, of course, one enjoys the socio-cultural setting of these opening-day-of-electronics lines).

[solipsism]

Originally Posted by anantksundaram

Hmmmm..... why not just order thru Apple's online store and save yourself the hassle? (Unless, of course, one enjoys the socio-cultural setting of these opening-day-of-electronics lines).

You have to signup for a 2-year contract with AT&T or extend your curent Cingular/AT&T contract by two years. This will require a signature so it's unlikely that you will be able to use a digital signature to purchase the phone online or use a voice verification for a phone purchase.

At least, that is how I understood it.

[iMichael]

Is the consensus here that there will be people camped out to get the iphone?

I just didn't see that happening. I would think most of the campers for PS3 were under the age of 30. I have no proof of that. I'm 34 and I have a PS3, but I didn't camp out for it.

A friend of mine did, he is 21. And he said most of the people their were in this age group.

What I'm trying to say is, I didn't think the market age for the iphone would be 17-25.

Not just because of the price, but because of the phone itself.

Maybe I'm wrong about this, but I don't see an 18 year old wanting this phone. Unless of course, he/she is an Apple fan.

Your thoughts?

[solipsism]

Originally Posted by iMichael

Maybe I'm wrong about this, but I don't see an 18 year old wanting this phone. Unless of course, he/she is an Apple fan.

Apple has been pretty good with supply and demand over the previous years. I think the AT&T stores will be have a small number of unit compared to the Apple Stores but will have new supplies coming in almost daily to meet needs. Then again, officially there is no waiting list allowed through Apple or AT&T so the extra-nerdy may give up a night of WoW ensure an iPhone by camping outside.

Previous reports have shown a large interest among high schoolers for the iPhone. The question is how many can afford it and are willing to shell out the money for one?

For the record, I'm buying 3 iPhone ASAP. One for me, one for a friend, and one for my brother. Yes, I'm also going to be paying for three 2 year contracts. I hope I get some sort of family deal out of that.

[Amorya]

Originally Posted by solipsism

You have to signup for a 2-year contract with AT&T or extend your curent Cingular/AT&T contract by two years. This will require a signature so it's unlikely that you will be able to use a digital signature to purchase the phone online or use a voice verification for a phone purchase.

At least, that is how I understood it.

You can order phones online here in the UK, including signing up for the contracts. I see no reason this shouldn't apply to Apple too...

Amorya

[iMichael]

So for those here planning to buy an iPhone, how are you going to go about getting it?

Apple store, AT&T store, on-line?

If you are going to a store, are you going to camp out early?

I was planning on going to an AT&T store near me. It's not in a mall, or in a major attraction area, so I was (wishfully) thinking not many people would be there when it opens.

Hoping an hour early would suffice.

[anantksundaram]

Originally Posted by solipsism

You have to signup for a 2-year contract with AT&T or extend your curent Cingular/AT&T contract by two years. This will require a signature so it's unlikely that you will be able to use a digital signature to purchase the phone online or use a voice verification for a phone purchase.

At least, that is how I understood it.

I would be quite shocked -- and disappointed -- if Apple couldn't find a workaround for this.

Given that they are selling the phone in the Apple Store (surely, the sales staff there aren't mobile subscription salespeople), I would have to assume that they will find something analogous online.

Otherwise, there would have tobe some sort of a caveat on Apple's website by now. Indeed, the iPhone web page at Apple.com now says "Visit the Apple Store online (1-800-MY-APPLE) or at retail locations." (Obviously this site has been updated, since the FCC caveat has disappeared).

[solipsism]

Originally Posted by iMichael

So for those here planning to buy an iPhone, how are you going to go about getting it?

Apple store, AT&T store, on-line?

If you are going to a store, are you going to camp out early?

I was planning on going to an AT&T store near me. It's not in a mall, or in a major attraction area, so I was (wishfully) thinking not many people would be there when it opens.

Hoping an hour early would suffice.

I'm going to walk into an AT&T retail outlet. If that doesn't work I'll have them call other outlets in the area to see who still has a few iPhones left. If they doesn't pan out, I'll drive the 2 hours to my Apple Store.

I'd much rather do the transaction online or over the phone but I really don't see that happening as I'm not currently an AT&T customer.

[demenas]

Originally Posted by solipsism

You have to signup for a 2-year contract with AT&T or extend your curent Cingular/AT&T contract by two years. This will require a signature so it's unlikely that you will be able to use a digital signature to purchase the phone online or use a voice verification for a phone purchase.

At least, that is how I understood it.

Since when have you not been able to buy a Cell phone with contract online?

Steve

[solipsism]

Originally Posted by demenas

Since when have you not been able to buy a Cell phone with contract online?

Steve

Rhetoric aside, I am not aware that one can sign up with a new carrier over the phone.

[nevenmrgan]

Originally Posted by solipsism

Rhetoric aside, I am not aware that one can sign up with a new carrier over the phone.

I signed up for my first cellphone ever (with AT&T) online. If I remember correctly, they mailed me some forms to sign which I had to return within 30 days or risk having the plan dropped. I'm not sure about signing up over the phone, but my intuition says that this is possible as well.

[solipsism]

Originally Posted by nevenmrgan

I signed up for my first cellphone ever (with AT&T) online. If I remember correctly, they mailed me some forms to sign which I had to return within 30 days or risk having the plan dropped. I'm not sure about signing up over the phone, but my intuition says that this is possible as well.

That would be cool. I have no interest in driving around all day to various AT&T stores looking for one with a few iPhones to sell me, or driving a couple hours to my nearest Apple Store.

[demenas]

Originally Posted by solipsism

Rhetoric aside, I am not aware that one can sign up with a new carrier over the phone.

You can sign up with ANY cell phone carrier online. It's no rhetoric and they have been doing it for years. You can do it at amazon.com also and probably 100s of resellers.

Steve

[LookingForMore]

Originally Posted by iMichael

Is the consensus here that there will be people camped out to get the iphone?

I just didn't see that happening. I would think most of the campers for PS3 were under the age of 30. I have no proof of that. I'm 34 and I have a PS3, but I didn't camp out for it.

A friend of mine did, he is 21. And he said most of the people their were in this age group.

What I'm trying to say is, I didn't think the market age for the Iphone would be 17-25.

Not just because of the price, but because of the phone itself.

Maybe I'm wrong about this, but I don't see an 18 year old wanting this phone. Unless of course, he/she is an Apple fan.

Your thoughts?

I would have to say you are wrong. I asked my daughter the other day who is 14 in 8th grade if she heard of the Iphone. Her reply was it was the buzz around the school and her friends were talking about it. She said several of her friends are going to get one. So being an old fart I said sure I bet the parents are not going to pony up for these phones. She then said Doh, you know summer is when us kids get most of our money to buy the things we want that the parents say (you can only have it if you pay for it.)

She also said it was important socially to be able to show your friends the cool stuff you have the first day of school in September. So I dusted off my old brain and thought back to the high school days. Yes, kids were spending lots to look cool and to have cool car stereos, etc. Personally, I always had money for what ever I wanted in High School as I worked odd and end jobs from time to time to pick up cash. And I did purchase a very expensive car stereo. (sometimes it is better to buy what you think is cool and all they really want is a phone that plays Itunes)

I checked the census website and found over 16 million kids in High School. So even if only one out of 20 can scrape up the cash for one of the coolest items a kid could have when they return to school in September then that is quite a few kids in line.
Estimates, I saw was Apple could get maybe 1 million phones built by release day. If thats true and 2000 locations then each location could only have 500 phones. Chances are each location will have like 200 phones with the rest in warehouses ready to be delivered to the stores that run out. I expect many stores to be telling people the phones are not in stock by the end of the first day of the release as they are waiting for more phones to be delivered.

[-dF]

The last time I bought a phone (my now-haggard Treo 600 (which is getting stomped on as soon as I get my iPhone)) it was when I switched to Verizon. New phone, 2-year contract... and I did it all over the phone.

[SDW2001]

Originally Posted by solipsism

Apple has been pretty good with supply and demand over the previous years. I think the AT&T stores will be have a small number of unit compared to the Apple Stores but will have new supplies coming in almost daily to meet needs. Then again, officially there is no waiting list allowed through Apple or AT&T so the extra-nerdy may give up a night of WoW ensure an iPhone by camping outside.

Previous reports have shown a large interest among high schoolers for the iPhone. The question is how many can afford it and are willing to shell out the money for one?

For the record, I'm buying 3 iPhone ASAP. One for me, one for a friend, and one for my brother. Yes, I'm also going to be paying for three 2 year contracts. I hope I get some sort of family deal out of that.

Apple has been totally SHITTY with supply and demand over the years. What are you talking about? I am getting an iPhone when it comes out...but that's assuming I can get one at all. T

Then of course I have to get out of my VZW contract. I don't have a text plan so I think I can use that against since they changed the fees without my approval. There is a lot of talk about this right now...that people without text plans can get out if they want to.

[solipsism]

Originally Posted by SDW2001

Apple has been totally SHITTY with supply and demand over the years.

I've purchased a good del of Apple products the day—or week—they were available. The last time I had an issue was with the 1G iPod Mini.

What issues are you referring to?

[SDW2001]

Originally Posted by solipsism

I've purchased a good del of Apple products the day—or week—they were available. The last time I had an issue was with the 1G iPod Mini.

What issues are you referring to?

Are you kidding? Really, you are...right? Until the last year or two, Apple took billions in backorders. It's been getting better, but it's one of their main problems, especially when a new product was announced. In the New Steve Jobs Era, it began with the PMG4 debacle and went from there, especially with the G4 products.

[solipsism]

Originally Posted by SDW2001

Are you kidding? Really, you are...right? Until the last year or two, Apple took billions in backorders. It's been getting better, but it's one of their main problems, especially when a new product was announced. In the New Steve Jobs Era, it began with the PMG4 debacle and went from there, especially with the G4 products.

No, I'm obviously not. Over the past 3 years, I've purchased dozens of machines and various other Apple items and have had ONLY ONE item, the afore mentioned 1G iPod mini, that was not in stock.

Prior to 3-5 years ago I did encounter several issues.

Either I was very lucky or you were very unlucky. No need to get worked up about it.

[-dF]

The 1G iPod Nano was in very short supply when it first showed up in late 2005. I had to call the LA Apple stores daily to see if they received new shipments... but they did set up a call list for people who wanted one.

[SDW2001]

Originally Posted by solipsism

No, I'm obviously not. Over the past 3 years, I've purchased dozens of machines and various other Apple items and have had ONLY ONE item, the afore mentioned 1G iPod mini, that was not in stock.

Prior to 3-5 years ago I did encounter several issues.

Either I was very lucky or you were very unlucky. No need to get worked up about it.

I didn't encounter issues, they were just out there. It has been one of Apple's biggest problems with introducing new products. Not so much on established ones.

[cuencap]

I was at a mall here in California, and I talked to two Cingular kiosks. One said the iPhone will be $600 and $700 and that it will not be available in Cingular stores until 6 months after the launch. I laughed at their stupidity and went to the next kiosk....

The guy at the next kiosk said there is one version for $600 and it will only be available in Apple stores.

What idiots! How are they so stupid? The only consistent information across both kiosks is that it is coming out in Late June - that's all they would say! When I said June 20th? They both kinda smiled and said late June....

I think they are playing stupid for now...

[solipsism]

Originally Posted by cuencap

I laughed at their stupidity and went to the next kiosk....

What idiots! How are they so stupid?

Don't you feel you are being a little harsh here? The iPhone isn't out yet so there is no reason they should be well versed on it's pricing, or any other aspect at this point. They are Cingular employees who obviously don't spend their days perusing Apple focused websites. Outside of the basic price and capacity I wouldn't expect many Apple Store employees to be much more knowledgeable at this point.

[cuencap]

With any new product launch that is less than 3-4 weeks away, the least they could know is the proper price points...

At the first kiosk, I asked an employer and his "manager" was quick to come over to provide the 600-700 prices and tell me that no Cingular store would have it for 6 months. I just found it interesting, that's all