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April 1, 2008, 5:17 pm

Where did all the iPhones go? [Updated]

iphone-shortage.pngThere’s not an iPhone to be had — not even for ready money — at the flagship Apple stores in New York City, Chicago, Miami or San Francisco, according to a telephone checks conducted by AppleInsider.

Readers doing their own surveys reported stores running out in Michigan, New Jersey, Pennsylvania and Texas.

Piper Jaffray analyst Gene Munster called 20 Apple stores across the county on Wednesday and found no iPhones anywhere. Zero.

Even AT&T seems to be running out of inventory.

It’s a mismatch of supply and demand not seen since the summer of ‘07, when Apple (AAPL) offered would-be buyers state-by-state listings — updated daily with little green and red lights — showing which stores had the devices in stock.

What’s going on? Piper Jaffray analyst Munster puts odds on the possibilities:

  • 20% chance Apple is dealing with some kind of production or manufacturing problem.
  • 80% chance that Apple is clearing inventory and has a new version of the iPhone coming earlier than anticipated

Meanwhile, if you’re looking for an iPhone, Apple.com is still promising to ship within 5 to 7 business days. And a search on eBay on Wednesday afternoon turned up 2,346 listings for iPhones and iPhone unlocking services.

UPDATE: Bernstein Research’s Toni Sacconaghi weighed in on the shortage  in a report to clients. He notes that while iPhones seem to be out of stock at virtually all Apple retail stores, they are widely available at AT&T outlets in the U.S. and at O2, Carphone Warehouse, Orange and T-Mobile outlets in Europe.

This suggests to him that rather than clearing inventory for early release of a new iPhone, Apple is probably dealing with a production-caused shortfall with a “family hold back” strategy. Rather than upset its partners and reduce the number of iPhones it could report as sold in the March quarter, Apple supplied its partners before it supplied its own stores.

A prolonged shortfall, he estimates, could lead to lost sales of 20,000 to 40,000 units a week.

And here I was trying to get an iPhone at the Santa Rosa, CA Apple Store yesterday only to be met with NO. So, I ordered one last night from the Apple web store. Now comes Mr. Anonymous reporting that the same store now has some in-stock, and my web order is still showing a 5-7 day wait before they ship. Jeez, I may as well up and cancel the order and get a BB Curve on T-Mobile.

Posted By Some Doode, Santa Rosa CA : April 2, 2008 6:55 pm

For the gentleman who’s phone appeared to lock up on call forwarding. I had a similar problem. My phone would appear to lock up on certain incoming calls. The problem turned out to be that I had attached a LARGE (3 megabyte) picture (jpg) to the affected numbers. The iPhone took so long to process that file that the phone would time out and not ring before the incoming call was terminated as not answered. I hope this helps.

Posted By Joe Magee, Dallas, TX : April 2, 2008 4:36 pm

They are back in stock… Sorry to burst the bubble, but they are popular and possibly Apple under estimated the demand that caused the shortage to which may suggest that Apple’s goal of the amount of iPhones to be sold this year is well within its grasp.

Posted By Rigoli, Sonoma County California : April 2, 2008 3:17 pm

Reporting from Apple Store Santa Rosa. We have them…

Posted By Anonymous : April 2, 2008 3:12 pm

Must be the recession that is causing the problem since the IPhone is only about $500 per copy.

Posted By Martin Eagle, CO : April 2, 2008 3:05 pm

guess the economy must not be that bad if all people complain about is where they can get their hands on a $400 telephone

Posted By Norm, Atlanta, GA : April 2, 2008 2:24 pm

They’ve been out of stock in Portland, OR since the weekend.

Posted By David, Portland, OR : April 2, 2008 1:08 pm

oops, meant to say that even apple is “not” perfect at predicting demand :)

I think it would be pretty cool if the shortage was due to a dozen or so corporate orders for 5,000 iphones….that would be an interesting twist. Do you think corporate users care about the 3G capabilities though? I would imagine that they would, but maybe they are signing up for a tailored upgrade contract so that the 3G phones will be part of their supply contract with apple.

anyone have any info on companies ordering iphones and officially integrating it into their system? I’ve heard of a few places offering employees the choice of a mac, pc, or linux laptop, and most new employees choose the mac. I was in a conf. room last year with more than 40 lawyers from a large NYC law firm and all the young associates had mac powerbooks. They said the firm let them choose, and everyone chose a mac.

Also, I believe Google and Sun let their employees chooses which laptop they want and almost everyone chooses a mac.

Can anyone confirm or add to this based on their own experience?

Posted By ocmacfan-costa mesa, ca : April 2, 2008 11:15 am

went to the apple store in south coast in the orange county, calfiornia. The store clerk said that all apple stores and most att stores in southern california are sold out of iphones- from LA all the way to San Diego. He said he didn’t know when more would come in. He said if i really wanted one, I should try att stores, but said they probably are sold out too. I didn’t say anything else but he went on to say that he doesn’t know anything else. Seems like he’s been asked that a lot. i really wonder what’s going on. it doesn’t seem like apple would let a supply problem happen with the iphone, but who knows even they are perfect at predicting demand. Also, it could be a supplier problem that is out of apple’s control. another possibility is that corporate users are ordering up all the supply. i believe at the SDK event, Genetech said they have 1,000 iphones in the enterprise? What if apple got a huge order from another big company or a few? say 10 companies ordering 1,000 iphones? or possibly the us government ordering custom iphones?

who knows….maybe its the 3G phone, but that still seems like it will be in June….

Posted By ocmacfan-costa mesa, california : April 2, 2008 11:09 am

iphones are missing in the birmingham, alabama apple store…

Posted By ryan, birmingham, AL : April 2, 2008 10:13 am

I was in Miami for 2 weeks and a week ago Iphones desapeared from stores, I went to 3 stores and had no one available. The story it’s true.

Posted By Eddie Kaplun, Aventura, Fl : April 2, 2008 1:17 am

When will they make it actually work for calls? I bought me and my wife one on new years and I have spent 22 hours on the phone with appl and t since then I hate it as a phone. Sure the voicemail works great and its nice to be able to rewind or listen to the 6 min call and just replay the name or number without 6 min. again, and the rotate screen is cool, and the calender, notes and e-mailing notes, and google maps is the sh*t. But I use it for my auto shop and forward calls to it and I cant tell when its locked up and looks fine but Im missin calls and $$. Then I get back to the shop hear the land line ring and realize my stupid I-phone aint ringing. I cant give up my I-phon but I cant call it a phone. The pix are great and you can zoom in on stuff, e-mail a shot of a car part or neccessary repair to a customer, but I need a phone. Guess I’ll get a blackberry for phone and web that I can’t get with appl browser, and have two in my pocket while I wrench on a car???? Maybe I shouldnt talk smack against the stock while I want the stock to go up, cuz I’m holding 2 call options but I hope they do make a better I-phone that actually recieves calls.

Posted By Brian Hathaway, Rancho Cordova Ca : April 2, 2008 12:38 am

April Fools

Posted By NJ : April 1, 2008 11:36 pm

I doubt you would have seen it in one day, the one I ordered last week spend 1 day in customs, and paying for fast shipping won’t even speed up customs!

Posted By Gregg Jones, Starkville, MS : April 1, 2008 10:07 pm

Hey!

And what about the possibility that they are just selling much faster than anticipated?

ALL sellers attempt to manage production so as to have exactly X number of weeks supply on hand. Too much and you are out cash and need to pay for storage, too little, and you have trouble keeping up with customers in all locations. Apple tries to keep it tight. So perhaps there was just a run on the bank.

Posted By jmmx, portland OR : April 1, 2008 8:28 pm

Where’s TONI SPAGHETTI?

Posted By Jim, Hindquarters, NM : April 1, 2008 8:24 pm

iPhone 2 will be announced:

They will introduce a version of the iPhone in that present size and shape (form factor) which we will call iPhone 2 and will have these improvements. It will sell at $399

a) it will sold in 16GB or 32 GB versions (remember the present iPod Touch is at 16GB so that will be a minimum - the NAND chip technology used for the on-board RAM is getting M-U-C-H cheaper) expect it to have 32 & 48GB by August/September 2008

b) it will have a longer battery life. The touch screen is the major energy user and a low energy version plus tweaking the brightness and contrast will add three more hours of non-standby use to the iPhone 2

c) it will have an easy to replace battery that plugs into the logic board instead of having to be de-soldered and soldered back in to replace it.

d) it will have a 3G/GSM radio transmitter. One of the problems Apple faces in trying to sell the iPhone 1 around the world is it’s radio telephone only works at the 2.5G level. Apple will loose the Chinese market permanently without 3G/GSM technology immediately.

The Chinese government has made it pretty clear they will not allow this aging connectivity method to be re-instituted in their country. The fact is… China has a three widely different technologies in use for cell phone communication and the view is the 6 carriers they have wil be consolidated by government edict to 3, then over time the two older ones technologies will be killed off, (no one likes paying Qualcom royalities in cash, in an industry that prefers cross-licensing). The older technologies once replaced with GSM throughout the country will yield three compteting companies.

Apple has been lucky in one regard, even though the Olympics are being held in Beijing the Chinese government has not been able to build out their cell phone system to a world standard (GSM) in time for the Games and it left Apple some breathing room.

That breathing room will expire at the end of this year for them and the Chinese are working on their own cell phone operating system that wil include a touch interface and ditching the Qualcom connectivity so they can lead the planet in cell technology. Apple needs to get their phone to the GSM immediately or risk loosing the Chinese forever.

e) All iPhone front faces are determined by software, and Apple will allow you to determine which buttons and widgets you want on “your Mini iPhone” screen through settings. These settings will also you to add 3rd party widgets (utility programs) to the surface of the iPhone. You will come to think of the iPhone as “your desktop” and add the “shortcuts/aliases” in the form of buttons to your phone surface.

f)This will become known as the “Boy iPhone” because their will be WiFi games written for it within the next few months so it can be used in a “multi-player wireless mode”. In time expect the multiplayer game
environment to use the telephone connection for a global game session. For the older guys, expect Ultimate Bet and Party Poker to write for this platform, which you will connect to their servers through the WiFi
connection. And of course another reason to own this model will be the larger screen for movie and TV show playback and the ability to have more “desktop shortcut/aliases”.

Mini iPhone will be announced:

Apple will introduce a new iPhone form factor, the Mini iPhone, it will have many of the iPhone 2 features in a smaller size. This is the smallest size that you can come to expect and still be able to have the screen “understand” your finger. It will sell at $359

a) Size of device, not everyone needs all the touch buttons that are on the iPhone 1 and iPhone 2 (the iPhones with the larger “Primary iPhone Form Factor”) . Frankly if you don’t own stock why do you need the stock quote button on your screen. The Mini iPhone will the Secondary iPhone form factor. It will be 80% the width and 80% of the height of the iPhone 1 form factor and the same thickness. It will have a slimmer edge bezel on the face plate allowing the device to have 85% of the Primary form factor “touch real estate”. So again 80% of the height and width which means it will be under 60% of the original Primary form factor’s square inch surface.

All iPhone front faces are determined by software, and Apple will allow you to determine which buttons and widgets you want on “your Mini iPhone” screen through settings. These settings will also you to add 3rd party widgets (utility programs) to the surface of the iPhone. You will come to think of the iPhone as “your desktop” and add the “shortcuts/aliases” in the form of buttons to your phone surface.

b) it will have an easily replaceable battery using a plug, unfortunately it will have an aluminum frame around where the touch screen is mounted to and the back plate will use a push fit with small prongs making it near impossible to open up without destroying the backplate and marring the Black edge bezel on the front.

c) Battery life will be a nudge longer than the iPhone 2

d) Initially, it will come in a 16GB RAM model only, but that will be more than enough. At the end of 2008 that will be bumped to 32GB

e) it will have the 3G/GSM radio transmitter

f) it will have a re-configurable “desktop” allowing you to have the buttons and widgets you want on the touch screen

g) IT WILL PROBABLY BE THE ONE I FINALLY BUY, toward the end of 2008, when it’s the 32GB model

Posted By Frank Walburg, Santa Rosa, CA : April 1, 2008 7:51 pm

Did anybody call Tony S? He’d know.

Posted By StevieJ, Cupertino, Ca. : April 1, 2008 6:39 pm

I just ordered a 16Gig Iphone online and got it in 5 days as promised.

Posted By Scott, Flemington, NJ : April 1, 2008 6:14 pm

Nonsense, I ordered an IPHONE on line from the apple store and received it within 4 days. i would have gotten it in one day but I refused to pay for additional shipping.

Posted By Joe G NY : April 1, 2008 6:10 pm
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Philip Elmer-DeWittSilicon Valley veterans like to joke that Steve Jobs must be surrounded by a reality distortion field; if you get too close to him, you start to believe what he's saying. Thanks to the success of the iPod, the launch of the iPhone and the renewed interest in the Mac, Apple has made believers out of millions of customers - and made a lot of investors rich. But Philip Elmer-DeWitt believes that an ounce of skepticism never hurts when writing about the company. He should know. He's been covering Apple - and watching Steve Jobs operate - since 1982, first for Time Magazine, then for Business 2.0, and now for Fortune.
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