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Verizon iPhone 4 launch healthy, not "blowout"

post #1 of 45
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First day retail store sales of the Verizon iPhone 4 were reported to be an indication of healthy but not "blowout" demand, with most stores still reporting inventory towards the end of the day.

According to a note from RBC analyst Mike Abramsky, checks with 40 different Verizon retail stores in New York, Chicago, Boston, Los Angeles, Miami and other cities showed no signs of "stockouts," while the number of people waiting in line "appeared smaller than those for the AT&T iPhone 4 last year, but demand was steady though the day."

Abramsky added, "positively, some stores we spoke to indicated they may stock out by end of the day."

The note said it would be important "to monitor sell-through next few days (and weekend) to see if demand is spread over several days vs. concentrated to the first day" and to see whether Apple is "still on track for our 1M Verizon iPhone first week estimate."

In laughably short lines, the joke is on you

The reported lack of long lines for the Verizon iPhone 4 was blamed for a rapid but minor selloff in the company's stock, as bloggers like Dan Frommer of Silicon Alley Insider remarked that lines were "laughably short."

However, the number of people forced to wait long lines at retail stores was likely reduced by a successful round of pre-orders, which didn't occur in conjunction with the AT&T iPhone 4 launch last summer. When pre-orders failed along with an overwhelmed eligibility server, vast numbers of people interested in AT&T's iPhone 4 made retail store reservations instead, appearing at the special "first day event" which Apple actively converged its customers toward, creating a news story of demand success that was really a picture of operational failure.

The result was laughably long lines on the initial launch day. Lines also moved rather slowly because Apple forced each buyer to sit through a sales pitch for MobileMe and AppleCare while also providing hands-on assistance with setting up the phone. Had Apple's pre-order system worked correctly, and had the company executed a more efficient handling of the crowds that resulted, there would have been no need for long lines, just as there are no lines for Nokia phones despite the company selling, by far, the most phones worldwide.

At the same time, many customers simply walked into AT&T's nearly empty retail outlets and made iPhone 4 purchases without waiting at all, or showed up a day or two later to avoid the media circus revolving around Apple's own retail store launch. The presence of long lines has little correspondence with the overall demand expressed.

That makes looking at the length of lines in front of some retail outlets a fairly poor indicator of how many units are actually being sold, and a better indicator of how poorly the company is managing to supply whatever demand that does exist. Similarly, while the initial production shortages that dogged each new iPhone release dramatized the voracious demand for each new model, it would be even better for Apple to be able to build enough to meet demand.

Can Apple build enough?

A previous report indicated that Apple had produced an initial supply of 2 million CDMA iPhones, some proportion of which it allocated for Verizon's pre-orders.

Abramsky's report added, "note that Apple is delaying [online] Verizon iPhone shipments until Feb 18, possibly indicating stronger than expected pre-order demand."

If Apple allowed pre-orders to exceed the initial allocation, it would make sense that launch day orders would be delayed an additional week or two until the company can produce more and ship them to the US. Had the company simply shut down pre-orders early, it could have pushed more inventory into a small number of stores and generated another "long lines" story for the media instead.

It appears that iPhone launches increasingly don't require such publicity anymore, making more sense that Apple instead work to take as many pre-orders as it can, stock as many retail outlets as possible, and leave the waiting for online orders to ensure that every last phone it can produce will be sold as quickly and as efficiently as possible.
post #2 of 45
I think with it being cold outside, most people that wanted it, pre-ordered online.
There are Many other factors this VZW launch isn't going to be the "blowout" some thought it might be.
Most people who really wanted an iPhone, already has it on AT&T.
AT&T knew this was going to happen and locked in A LOT of people with early upgrades, unless people want to part ways with large ETF fee's, they are staying with AT&T.
There are always those who complain about AT&T, but there are people like me who Love AT&T.
Most who wanted unlimited Data on AT&T simply just never went to the 2G Data pro $25 plan. Grandfathered plans aren't taken away, you have to give them up willingly.
With Android releasing a new device every 4 days, VZW likely had Many of the VZW folks also locked down, unable to upgrade.
Then, Apple fans already know iPhone 5 will be out in 4-5 months. I wouldn't lock my contract up today knowing I can wait a little longer and get the latest device.
I still think the phone is going to sell well even with all the above taken into consideration.
post #3 of 45
Does the hype of the long lines etc add to or drive a public mentality to get an iPhone? Thus when it(the hype / expectation) doesn't happen, the 'herd' thinks- meh... must not be that great a devise. IMO there is a smigeon of truth, but what really 'drives the herd' is a damn good iPhone.
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post #4 of 45
It's a six-month old product. What did people expect? If you're desperate enough to queue, you're probably desperate enough to use AT&T.

I'm sure that there will be long queues when the iPhone 5 is released with CDMA support.
post #5 of 45
Good save, DED.
post #6 of 45
Coming from appleinsider, a headline like "healthy" must mean the launch was an utter failure
post #7 of 45
I feel like Apple's approach to the Verizon iPhone was entirely different then their normal marketing ways (no steve jobs to introduce the "Verizon iPhone"!!??). I imagine the demand will show much greater volume during the next full version release of the iPhone.
post #8 of 45
Quote:
Originally Posted by nvidia2008 View Post

Good save, DED.

The next important thing is to remember this article when the iPhone5 comes out and avoid an article about the long lines and amazing demand...
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post #9 of 45
"while the number of people waiting in line "appeared smaller than those for the AT&T iPhone 4 last year, but demand was steady though the day."

Really? You mean lines 8 months after the lunch of the phone appeared smaller than those at launch? And with a new iPhone on the horizon? Absolutely shocking news. I'm glad this was reported by RBC, as I would absolutely not have come to this obvious assumption.

Wow.
post #10 of 45
Quote:
Originally Posted by bkcrowl View Post

I feel like Apple's approach to the Verizon iPhone was entirely different then their normal marketing ways (no steve jobs to introduce the "Verizon iPhone"!!??). I imagine the demand will show much greater volume during the next full version release of the iPhone.

Uh, it wasn't abnormal, it was logical. What the hell would Steve Jobs say on stage while introducing it? This is the iPhone 4 I revealed 8 months ago and.... it rus on Verizon!

That doesn't sound like a presentation Jobs would make, or one that anyone wouldn't want to watch. They handled it exactly as they should.
post #11 of 45
Quote:
Originally Posted by Slurpy View Post

"while the number of people waiting in line "appeared smaller than those for the AT&T iPhone 4 last year, but demand was steady though the day."

Really? You mean lines 8 months after the lunch of the phone appeared smaller than those at launch? And with a new iPhone on the horizon? Absolutely shocking news. I'm glad this was reported by RBC, as I would absolutely not have come to this obvious assumption.

Wow.

yes but there's been months of sabre rattling on how this was going to completely kill all other competition. Now, it's oh wait til the iphone 5 comes out. whatever.

several companies are really strong, microsofts had it's ass kicked rightfully, and the competition, being really fierce, means we get great phones, in whatever OS flavour you prefer.
What I got... 15" i7 w/8 gigs ram,iPad2 64gig wifi, 2.0 mac mini, 2.0 17" imac, appleTv, Still running my old G4 466 upgraded to 1.2GHz maxed ram as a pro tools machine, and 2 iphones.
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What I got... 15" i7 w/8 gigs ram,iPad2 64gig wifi, 2.0 mac mini, 2.0 17" imac, appleTv, Still running my old G4 466 upgraded to 1.2GHz maxed ram as a pro tools machine, and 2 iphones.
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post #12 of 45
I thnk it is amazing that there is a line at all. When Nexus-S sell on another carrier 6 months from now, will there be lines? I don't think so.
post #13 of 45
Quote:
Originally Posted by Slurpy View Post

Really? You mean lines 8 months after the lunch of the phone appeared smaller than those at launch? And with a new iPhone on the horizon? Absolutely shocking news. I'm glad this was reported by RBC, as I would absolutely not have come to this obvious assumption.
Wow.

More likely because of all the new Android phones with 4G, dual core, beautiful OLED screens, etc. that are mere weeks away. I bet a lot of people will go into a Verizon store for an iPhone and end up walking out with an Android phone. Not only will they be more powerful and lower priced, but it's in Verizon's interest to push Android versus iPhone because they have more control. That might have been part of Verizon's strategy from the beginning. Carry the iPhone to get them in the door, but then try to sell them Android whenever possible.
post #14 of 45
Quote:
Originally Posted by Groovetube View Post

several companies are really strong, microsofts had it's ass kicked rightfully, and the competition, being really fierce, means we get great phones, in whatever OS flavour you prefer.

Microsoft just announced a partnership with Nokia.
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post #15 of 45
Quote:
Originally Posted by Meurglys View Post

More likely because of all the new Android phones with 4G, dual core, beautiful OLED screens, etc. that are mere weeks away. I bet a lot of people will go into a Verizon store for an iPhone and end up walking out with an Android phone. Not only will they be more powerful and lower priced, but it's in Verizon's interest to push Android versus iPhone because they have more control. That might have been part of Verizon's strategy from the beginning. Carry the iPhone to get them in the door, but then try to sell them Android whenever possible.

You make a very, very good point ... and every reason why I'll stick with my iPhone on AT&T.
post #16 of 45
Verizon will start new campaign:
Buy iPhone, get Android for free.
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post #17 of 45
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Originally Posted by hill60 View Post

Microsoft just announced a partnership with Nokia.

that's interesting, but I can't say I'm surprised. Symbian blew pretty badly. Such a huge phone company and a crappy eco system.

What I've seen of win7 mobile, I like that it didn't just use the same icon homepage thing both iOS and android uses. As long as there are no disasters with win7 mobile, I predict that one to be the sleeper. Give it a year or so. It'll carve out some numbers from all of the other 3.
What I got... 15" i7 w/8 gigs ram,iPad2 64gig wifi, 2.0 mac mini, 2.0 17" imac, appleTv, Still running my old G4 466 upgraded to 1.2GHz maxed ram as a pro tools machine, and 2 iphones.
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What I got... 15" i7 w/8 gigs ram,iPad2 64gig wifi, 2.0 mac mini, 2.0 17" imac, appleTv, Still running my old G4 466 upgraded to 1.2GHz maxed ram as a pro tools machine, and 2 iphones.
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post #18 of 45
With so many folks apparently ready to switch from AT&T to Verizon - when can I get a used iPhone 4/AT&T for cheap to give to my son to use as an iPod Touch? then again, perhaps a lot of early switchers will be those who still have iPhone 3G and 3GS who waited for the iPhone 4/Verizon to switch.

Or maybe I just wait for iPhone 5 and then give him my iPhone 4.

And what is up with folks no eBay listing items for $20 plus $550 shipping?
post #19 of 45
The stock comment is silly. The whole market sold off yesterday. Apple's stock just had a fabulous run up. The inquiry regarding lines is silly. First, it was a snow day in some parts of the country. Who is going to brave very brutal weather just to be one of the first to own the phone. Some people I am sure, but not many. Second, Apple was targeting the iPhone largely to Verizon customers. Apple isn't trying to get people to switch from AT&T. Verizon isn't giving incentives to switch to the iPhone early, so Verizon customers are tied into their current contracts. This never applied to AT&T. Most people upgraded their iPhones because 1) AT&T gave incentives to upgrade, and 2) people the contracts expired about the time the new phones came out. Third, maybe Verizon customers are smarter. Why go to a store, when you can have the phone delivered right to you?
post #20 of 45
"What do I use my smartphone for?"

Phone calls.....then Verizon is best.
Apps/Internet....then AT&T is best.
post #21 of 45
Quote:
Originally Posted by AppleInsider View Post

Apple is delaying [online] Verizon iPhone shipments until Feb 18

I just received shipping notification for the order I finished at 3:07 EST on the 9th. Fedex says it will arrive Monday.
post #22 of 45
Quote:
Originally Posted by noexpectations View Post

"What do I use my smartphone for?"

Phone calls.....then Verizon is best.
Apps/Internet....then AT&T is best.

True. But if you have access to WiFi 99% of the day as I do, then that mostly wipes out AT&T's biggest advantage.
post #23 of 45
The media has turned the Verizon iPhone launch into:

No lines = no demand = Verizon iPhone failure

Ignorant jackasses trying to spin controversy to short Apple.
post #24 of 45
Apple sells 1 million phones in first week through preorders and online buying with modest or no lines at stores = failure

Any other phone manufacturer sells 35,000 phones in first week with absolutely zero lines = smashing success
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post #25 of 45
Quote:
Originally Posted by lilgto64 View Post

And what is up with folks no eBay listing items for $20 plus $550 shipping?

Saves on final value fees. And if there is a problem , you only have to reimburse the final price, not the shipping.
post #26 of 45
Quote:
Originally Posted by Meurglys View Post

More likely because of all the new Android phones with 4G, dual core, beautiful OLED screens, etc. that are mere weeks away. I bet a lot of people will go into a Verizon store for an iPhone and end up walking out with an Android phone. Not only will they be more powerful and lower priced, but it's in Verizon's interest to push Android versus iPhone because they have more control. That might have been part of Verizon's strategy from the beginning. Carry the iPhone to get them in the door, but then try to sell them Android whenever possible.

That happens all the time over at the ATT stores - oh wait, well maybe not so much. 4G (in whatever flavor it is being deployed) won't be "ready for primetime" widely across the network - so your 4G droidy phones will languish in 3G hell except for those markets where ATT or Verizon get it operational over the next year. Depending on where you are at, you may not see 4G for a year or longer. And yeah - people love watching their purchase of their last device devalue as the carrier deliver newer ones with the latest tech and don't deliver the updates for the older models. Lots of consumers love it when that happens. And it happens alot for Android devices.
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post #27 of 45
Existing customers could pre-order the phone. A lot of Customers are still locked into contract with ATT/Verizon so they can't upgrade yet and heaven forbid they pay retail.

The iPhone will sell a lot of units on verizon, but it's going to be a trickle of customers, not some huge wave at the start. Also remember that MOST stores (most verizon locations are retailers) don't even have the device yet.

Early year is a weird time to launch a high end device because it's out of the upgrade cycle for most customers. Expect more as people start getting their upgrades, and as tax returns start flowing back in.
post #28 of 45
Quote:
Originally Posted by fecklesstechguy View Post

oh wait, well maybe not so much. 4G (in whatever flavor it is being deployed) won't be "ready for primetime" widely across the network - so your 4G droidy phones will languish in 3G hell except for those markets where ATT or Verizon get it operational over the next year.

Yeah, Verizon 4G is only available now in tiny markets like New York, Los Angeles, San Francisco, Seattle, Phoenix, Denver, Dallas, Houston, etc. etc. (plus in 60+ airports) No iphone users in those places
post #29 of 45
...is what many Verizon staff should be saying, becasue they are shooting themselves in the foot with many long time customers. Instead of running partial deals for customers who have stayed with them for four years waiting for the iphone, but had to update within the past two years because their old phone was dying, Verizon staff is flatly saying "less than two years, you pay retail."
I'd be willing to pay the early termination fee on all four of my family phones to upgrade to new two year contracts, but Verizon won't offer that. Ironically, that's exactly the deal I can get by going to AT&T. Then Verizon loses their current income from me, plus the $120 a month additional from the data upgrade.
Extremely short sighted.
post #30 of 45
Quote:
Originally Posted by island hermit View Post

Apple sells 1 million phones in first week through preorders and online buying with modest or no lines at stores = failure

Any other phone manufacturer sells 35,000 phones in first week with absolutely zero lines = smashing success

It's somewhat of an embarrassment for Verizon and slightly less so for Apple when sales pale in comparison to what AT&T has done. That's where the bar is set. All along, Verizon has been bragging about their network and were probably confident about stealing AT&T customers, but it doesn't appear that is happening. My guess would be that less than 0.5% of AT&T iphone users defected.

Verizon has yet to announce any sales figures, which is a pretty sure sign of a disappointing launch. Still, it's their best launch ever which means it beat out the Droid X and could be considered 'a win'.
post #31 of 45
Quote:
Originally Posted by bstring View Post

It's somewhat of an embarrassment for Verizon and slightly less so for Apple when sales pale in comparison to what AT&T has done. That's where the bar is set. All along, Verizon has been bragging about their network and were probably confident about stealing AT&T customers, but it doesn't appear that is happening. My guess would be that less than 0.5% of AT&T iphone users defected.

Verizon has yet to announce any sales figures, which is a pretty sure sign of a disappointing launch. Still, it's their best launch ever which means it beat out the Droid X and could be considered 'a win'.

The Verizon iPhone has been out for a week. I think it makes sense to give AT&T users time for their contracts to expire before switching.
post #32 of 45
Quote:
Originally Posted by Constable Odo View Post

The media has turned the Verizon iPhone launch into:

No lines = no demand = Verizon iPhone failure

Ignorant jackasses trying to spin controversy to short Apple.

So, you have evidence that a federal crime has been committed?
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post #33 of 45
Quote:
Originally Posted by bstring View Post

It's somewhat of an embarrassment for Verizon and slightly less so for Apple when sales pale in comparison to what AT&T has done. That's where the bar is set. All along, Verizon has been bragging about their network and were probably confident about stealing AT&T customers, but it doesn't appear that is happening. My guess would be that less than 0.5% of AT&T iphone users defected.

Verizon has yet to announce any sales figures, which is a pretty sure sign of a disappointing launch. Still, it's their best launch ever which means it beat out the Droid X and could be considered 'a win'.

Verizon has always been slow and steady. Just like a river that keeps flowing, the iphone sales numbers will continue to grow.

Anyone remember when the Droid was launched on Verizon? It was supposedly the iPhone killer. There were no long lines on launch day and therefore it was deemed a failure. Could never compete with the iphone. Now all of a sudden some people are claiming that Android is going to eat Apple's lunch. Not quite. It's not even a fair comparison to put countless android OPERATING SYSTEM phones up against a single Apple phone.

Severe Android fragmentation is already here and growing. That alone will mute the Android platform.

On a side note I see Nokia has teamed up with Microsoft. Two has beens adding up to one big has been. LOL........
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post #34 of 45
Quote:
Originally Posted by AppleInsider View Post

However, the number of people forced to wait long lines at retail stores was likely reduced by a successful round of pre-orders, which didn't occur in conjunction with the AT&T iPhone 4 launch last summer.

This may be part of the reason, but personally I lined up for the iPhone 4 at an Apple store when it went on sale to share the excitement and anticipation with other iPhone fans eager to get the new device. It seems to me that if you are someone who is excited enough about the iPhone to be willing to line up in cold weather for it, you are not likely to also be someone who waited patiently for four years to get it. I never expected long lines for exactly this reason.
post #35 of 45
If I could add WalMart stores, 2,000 Best Buy outlets, several thousand Radio Shack stores etc. to my distribution network, I'd kind of expect less sales per store myself. In addition, AT&T did everything it could to facilitate sales by allowing early turn-ins on shorter contract lengths to tie up customers from easily transferring to Verizon in anticipation of this. Verizon does not appear to have taken any special steps in that direction, so smart people will only buy when their current contract runs out. So 300 or lless Apple stores in 2007 would have long lines for a wholly new product, 2200 ATT stores + 350 apple stores had medium lines for a really improved product with early contract allowances, but 5-6,000 outlets with no contractual incentives producing very small lines for an "old" product is news? I don't think this should be any surprise. Let's compare iPhone 5 lines for a more comparable situation. In that case, ATT's iPhone4 contractual manuevering will probably hurt it's comparative iPhone5 sales because it locked in a lot of potential buyers for 2 years.
post #36 of 45
I have never stood in line for any phone. I've never seen the need to, doubly so if it's very hot or cold outside.
post #37 of 45
Quote:
Originally Posted by bstring View Post

It's somewhat of an embarrassment for Verizon and slightly less so for Apple when sales pale in comparison to what AT&T has done. That's where the bar is set. All along, Verizon has been bragging about their network and were probably confident about stealing AT&T customers, but it doesn't appear that is happening. My guess would be that less than 0.5% of AT&T iphone users defected.

Verizon has yet to announce any sales figures, which is a pretty sure sign of a disappointing launch. Still, it's their best launch ever which means it beat out the Droid X and could be considered 'a win'.

Why would anyone defect now? Most potential defectors are either locked in contract with ATT or will wait until a new iPhone is released. ATT didn't take customers from VZW all in one day and VZW isn't going to win them back in one day.
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post #38 of 45
Quote:
Originally Posted by bstring View Post

It's somewhat of an embarrassment for Verizon and slightly less so for Apple when sales pale in comparison to what AT&T has done. That's where the bar is set. All along, Verizon has been bragging about their network and were probably confident about stealing AT&T customers, but it doesn't appear that is happening. My guess would be that less than 0.5% of AT&T iphone users defected.

Verizon has yet to announce any sales figures, which is a pretty sure sign of a disappointing launch. Still, it's their best launch ever which means it beat out the Droid X and could be considered 'a win'.

Verizon IS stealing customers --- considering that since the iphone 4 was launched --- Verizon has accumulated 100K more postpaid subscribers than AT&T. VZ doesn't need the iphone to beat AT&T in postpaid net adds --- that's embarrassment for AT&T and Apple.
post #39 of 45
Quote:
Originally Posted by Meurglys View Post

More likely because of all the new Android phones with 4G, dual core, beautiful OLED screens, etc. that are mere weeks away. I bet a lot of people will go into a Verizon store for an iPhone and end up walking out with an Android phone. Not only will they be more powerful and lower priced, but it's in Verizon's interest to push Android versus iPhone because they have more control. That might have been part of Verizon's strategy from the beginning. Carry the iPhone to get them in the door, but then try to sell them Android whenever possible.

True. Verizon makes more money by using their preloaded apps on their phones. Apple does not allow for this on their phones. It has always been in Verizon's best interest to have Android phones support them. Heck, it helped Verizon when the iPhone went to AT&T. Having an iphone just allows for more customers. That's what its all about.
post #40 of 45
Quote:
Originally Posted by dasanman69 View Post

Why would anyone defect now? Most potential defectors are either locked in contract with ATT or will wait until a new iPhone is released. ATT didn't take customers from VZW all in one day and VZW isn't going to win them back in one day.

With an iPhone, contracts don't matter. Example: My co-worker owed $290 on his contract. He bought the Verizon iPhone and sold his AT&T iPhone for $420. That paid for his contract and most of the price for the new phone. iPhones sell for alot 2 years after they are out. They are almost never obsolete. One operating system, 4 types of phones. Many google phones, many different operating systems. Not all google phones are the same latest system. I worked at Apple and now Verizon, I know.
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