Report: Apple prepared 2 million Verizon iPhone 4 for preorders, retail

Posted:
in iPhone edited January 2014
Apple prepared 2 million CDMA iPhone 4 units to deliver to Verizon Wireless and its own retail stores through January, manufacturer reports indicate, suggesting that this year's preorders and launch of iPhone 4 on Verizon may actually exceed those of last year's iPhone 4 on AT&T.



This morning, Verizon Wireless announced that presales for iPhone 4 had exhausted the initial supply estimated to be available in its first day, and exceeded the carrier's previous sales records for phones such as the RIM BlackBerry Storm and Motorola Droid in just two hours, calling the sales "unprecedented." It did not say how many devices it had been allocated for these preorders however.



While the only figure floated by analysts so far has been 100,000 units (by Mike Abramsky of RBC Capital, on par with the first weekend of Verizon's sales of the Motorola Droid back in 2009), Ming-Chi Kuo of Concord Securities has indicated to AppleInsider that the number is likely to be much higher.



Based on discussions with component makers in Apple's supply chain, the analyst said Apple produced 2 million CDMA iPhone 4 units in December and January. Considering a ten day shipping delay to get these to US customers (the only market currently selling the CDMA version), the supply being fed to Verizon for preorders and for both Verizon and Apple retail stores on February 10 is expected to be in the two million range.



Philip Elmer-DeWitt of Fortune noted that Susquehanna analyst Jeff Fidicaro has estimated Verizon will sell 2.9 million iPhones before the end of March, which seems consistent with the production rates described by Concord Securities.



Did Verizon beat AT&T preorders using a year-old phone?



AT&T first day preorders for iPhone 4 last June, when the device was new, only amounted to 600,000.



That figure included initial manufacturing issues related with the new model (including Apple's failure to deliver white models as planned), and was also distorted by the complete meltdown of both AT&T's and Apple's online ordering systems. At the time, Apple noted in a press release that the total was "far higher than we anticipated, resulting in many order and approval system malfunctions. Many customers were turned away or abandoned the process in frustration."



In contrast, Verizon's preorder process was relatively smooth, in contrast to the frustrating AT&T launch, which dysfunctionally dragged on for hours before the company announced that its allocation of preorders had been sold out.



General launch still a week away



Last year, AT&T said preorder demand had been ten times higher than that of the iPhone 3GS in 2009. The subsequent iPhone 3GS launch sold more than a million phones in its first three days in 2009.



For comparison, the original iPhone launch moved 270,000 units, and took two and a half months to reach a million in sales in 2007 (at a much higher initial price), while iPhone 3G similarly hit one million in its first three days.



Last year's launch of the original iPhone 4 resulted in sales of 1.7 million in the first three days. At the time, the company's chief executive Steve Jobs said "this is the most successful product launch in Apple's history," before adding, "we apologize to those customers who were turned away because we did not have enough supply."



Supplies of the original iPhone 4 were constrained well beyond its launch; Apple stopped accepting launch preorders just a day after they became available. Apple was forced to temporarily suspend its toll-free number due to demand, and AT&T, the exclusive wireless carrier of the iPhone in the U.S., struggled to verify eligibility of its existing customers as the company's servers slowed to a crawl.



Verizon's actual iPhone 4 launch next week may likely be less problematic because it does not require global distribution across 87 countries that last years' launch of the GSM/UMTS iPhone 4 did. The model is also not new, but does serve a pent up demand among both Verizon users who have been waiting for an iPhone for four years, and AT&T users who desperately want an iPhone that works in their service area.



While analysts have consistently predicted the Verizon's sales will pale in comparison to AT&T's iPhone 4 sales over the last year, Apple may still be able to exceed its last year's launch of iPhone 4 this year with Verizon because of this pent up demand and its now well-honed manufacturing experience in building iPhone 4, following global sales over the last two quarters of more than 30 million iPhones, the majority of which have been iPhone 4 models.



At its official launch next week, Verizon said its new iPhone 4 would be made available at Verizon and Apple retail stores as well as Best Buy and Wal-Mart. Article updates and clarifications emphasized.



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Comments

  • Reply 1 of 41
    sflocalsflocal Posts: 4,651member
    Just goes to show that users want quality and are willing to wait for it. This will be huge. It will be interesting to see if a line forms outside the Apple stores on launch day like last year.



    I'll love to read how the Android trolls will spin this.
  • Reply 2 of 41
    I think they should have made more... or hopefully there's more in the supply chain.



    I understand the "sold-out" headlines are great but who cares now that the iPhone5 is coming out by summer.
  • Reply 3 of 41
    Well of course they beat AT&T pre orders. It was the 4th version AT&T got and the first Verizon is getting. Many people had the other 3 phones and didn't want to go after an iPhone 4. Either way, this is good for Apple and bad for Android so it works for me!
  • Reply 4 of 41
    100,000 phones isn't cool. you know what's cool? two million phones.
  • Reply 5 of 41
    "This morning, Verizon Wireless announced that presales for iPhone 4 had exhausted the initial supply estimated to be available in just two hours. It did not say how many devices it had been allocated for these preorders however."



    This statement by Verizon doesn't make sense. I am in Orange County, CA. I ordered 2 iPhones at 7:30 am Pacific Time on Thursday, my order was confirmed , and the phones are scheduled to be delivered to me on Monday by 3 pm according to Fed Ex.



    So either the initial supply wasn't exhausted in 2 hours (which would have been 2 am Pacific Time), or they had more iPhones for pre-orders become available.



    I'm not complaining, just glad to finally get an iPhone on Verizon.
  • Reply 6 of 41
    tbelltbell Posts: 3,146member
    I sure hope that would be the case, and the comparison isn't even a fair one to AT&T. With Verizon there is pent up demand from Verizon customers. When AT&T offered the iPhone 4, it largely was selling to people who already had iPhone and were eligible to upgrade. Most people who wanted iPhones and were willing to go to AT&T had already done so.



    Quote:
    Originally Posted by AppleInsider View Post


    Did Verizon beat AT&T preorders using a year-old phone?



  • Reply 7 of 41
    [QUOTE=AppleInsider;1801471]" Apple prepared 2 million CDMA iPhone 4 units to deliver to Verizon Wireless and its own retail stores through January...."

    Apple "prepared"? How about Apple "manufactured"? Or Apple "built"? Saying Apple "prepared" 2 million CDMA phones makes it sound as if the iPhone is coming from the kitchens at the Food Channel.
  • Reply 8 of 41
    archosarchos Posts: 152member
    Quote:
    Originally Posted by allmypeople View Post


    I think they should have made more... or hopefully there's more in the supply chain.



    I understand the "sold-out" headlines are great but who cares now that the iPhone5 is coming out by summer.



    I'm pretty sure not being able to make enough iPhone 4s is not part of a strategy to create stories about not having enough!



    Apple execs have made it clear all along that they are producing iP4 as fast as possible and if they could make any more, they would have been able to sell more.



    This is tough work! It's unprecedented. And nobody else in the industry is doing a better job at stoking demand for high end phones.
  • Reply 9 of 41
    @DED

    I love Apple and I love my iPhone 4, but you seem to really be twisting words around lately (inaccurately) trying to create some form of Apple propaganda. It's not becoming of AI.



    You said "exhausted the initial supply estimated to be available in just two hours". This is 100% false. This morning Verizon said "In just our first two hours, we had already sold more phones than any first day launch in our history."
  • Reply 10 of 41
    So much demand because people are buying the Verizon 4-Pack: 1 for voice, 1 for data, etc....



    (Letterman clip)



    http://www.youtube.com/watch?v=ehxpvrJC5VA
  • Reply 11 of 41
    Quote:
    Originally Posted by GT500CA View Post


    "This morning, Verizon Wireless announced that presales for iPhone 4 had exhausted the initial supply estimated to be available in just two hours. It did not say how many devices it had been allocated for these preorders however."



    This statement by Verizon doesn't make sense. I am in Orange County, CA. I ordered 2 iPhones at 7:30 am Pacific Time on Thursday, my order was confirmed , and the phones are scheduled to be delivered to me on Monday by 3 pm according to Fed Ex.



    So either the initial supply wasn't exhausted in 2 hours (which would have been 2 am Pacific Time), or they had more iPhones for pre-orders become available.



    I'm not complaining, just glad to finally get an iPhone on Verizon.



    Yeah thats a mistake I think,

    They broke their launch record in two hours, sold out the initial allocation a few hours later
  • Reply 12 of 41
    Wow!
  • Reply 13 of 41
    In other news...Charmin increases toilet paper deliveries to the headquarters of RIM, MS, Google, Sony, Samsung, Nokia and Motorola!



    I don't think those guys are going to enjoy their weekends even with the Charmin!



    Best
  • Reply 14 of 41
    eriamjheriamjh Posts: 1,133member
    Quote:
    Originally Posted by allmypeople View Post


    ... who cares now that the iPhone5 is coming out by summer.



    There's always another phone coming next summer.
  • Reply 15 of 41
    Am I reading this correctly, Verizon sold 2 million pre-orders in 4 hours? Btwn 3AM and 7AM?



    If so, good for them!
  • Reply 16 of 41
    Quote:
    Originally Posted by Archos View Post


    I'm pretty sure not being able to make enough iPhone 4s is not part of a strategy to create stories about not having enough!



    Apple execs have made it clear all along that they are producing iP4 as fast as possible and if they could make any more, they would have been able to sell more.



    This is tough work! It's unprecedented. And nobody else in the industry is doing a better job at stoking demand for high end phones.



    Well said, Archos!



    Best
  • Reply 17 of 41
    [QUOTE=illinisouth;1801497]
    Quote:
    Originally Posted by AppleInsider View Post


    " Apple prepared 2 million CDMA iPhone 4 units to deliver to Verizon Wireless and its own retail stores through January...."

    Apple "prepared"? How about Apple "manufactured"? Or Apple "built"? Saying Apple "prepared" 2 million CDMA phones makes it sound as if the iPhone is coming from the kitchens at the Food Channel.



    Ain't "communication" great? It's what sets us above the rest of the animals!
  • Reply 18 of 41
    Quote:
    Originally Posted by Vatdoro View Post


    @DED

    I love Apple and I love my iPhone 4, but you seem to really be twisting words around lately (inaccurately) trying to create some form of Apple propaganda. It's not becoming of AI.



    You said "exhausted the initial supply estimated to be available in just two hours". This is 100% false. This morning Verizon said "In just our first two hours, we had already sold more phones than any first day launch in our history."



    MorningStar has some clarifications:



    http://news.morningstar.com/newsnet/...00248_univ.xml
  • Reply 19 of 41
    Quote:
    Originally Posted by Vatdoro View Post


    @DED

    I love Apple and I love my iPhone 4, but you seem to really be twisting words around lately (inaccurately) trying to create some form of Apple propaganda. It's not becoming of AI.



    You said "exhausted the initial supply estimated to be available in just two hours". This is 100% false. This morning Verizon said "In just our first two hours, we had already sold more phones than any first day launch in our history."



    Are you kidding?! Apple propaganda is the only reason I visit AI.
  • Reply 20 of 41
    Quote:
    Originally Posted by anantksundaram View Post


    Are you kidding?! Apple propaganda is the only reason I visit AI.



    I thought it was to see the lucid thoughts that dribble out of my little brain on a daily basis!
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