AT&T (T) on Saturday began offering refurbished iPhones for the lowest price yet seen in the United States:

• $99 for a black 8GB iPhone 3G (refurbished)
• $199 for a black 16 GB iPhone 3G (refurbished)

The price points are not entirely unexpected. For several weeks before Christmas, Apple (AAPL) blogs were buzzing with rumors that Wal-Mart (WMT) would be selling a new version of Apple’s iPhone at the magical $99 price.

But it was not to be. On Friday, Wal-Mart confirmed that starting Sunday, Dec. 28, it will carry the hot-selling phone at nearly 2,500 stores — but starting at $197, not $99.

AT&TS’s $99 iPhones are the same old models, slightly used.

According to the small print on att.com,

Refurbished phones are previously owned devices that have been unused or lightly used and returned during the 30-day trial period. Each refurbished phone is independently quality tested and loaded with the latest software to meet current factory standards. Some refurbished iPhone 3G devices will have minor scratches.

Refurbished iPhone 3G devices carry a warranty of 90 days or more. For details about the warranty on your refurbished iPhone 3G go to www.apple.com/support/oss/.

The catch? The heavily discounted phones come with the usual 2-year contracts, which can cost up to $2,000, depending on the plan.

The sale ends Dec. 31 or when AT&T runs out of stock, whichever comes first. Macworld Expo starts the following week, leading to speculation that AT&T may be using the occasion to clear inventory in advance of new models or new memory configurations.

The blogs and business wires were buzzing Monday morning with two juicy iPhone rumors: 1) That Wal-Mart would begin selling iPhones three days after Christmas and 2) That a low-end model would sell for $99.

The first, as we reported nearly three weeks ago, is true. (See Wal-Mart’s post-Christmas iPhone sale.)

The second, as near as anyone can tell, is almost certainly not true – although it seems to have taken on a life of its own, most prominently in a Bloomberg.com report published Sunday evening.

On Monday morning, MacRumors reported that, based on leaked Wal-Mart training and advertising material, the $99 iPhone rumor was “unlikely.” MacBlogz went further: “Based on every piece of information we’ve heard, and direct information inside AT&T, this is not happening.”

So how did the story get rolling?

It started with the Boy Genius Report. a blog with back-channel contacts at AT&T  (T) that have often proved reliable. In fact, the news that Wal-Mart (WMT) would be selling Apple’s (AAPL) iPhone originated with Boy Genius, although the date that sales would begin was fuzzy until a Boy Genius reporter got his hands on an AT&T memo spelling out the timeline for in-store training  and national rollout. (link)

The $99 iPhone rumor, although originating from the same site, had a very different feel to it. The Boy Genius report posted on Dec. 4, started like this:

“We just got a tip that in addition to the iPhone 3G actually making its way to Walmart, as we exclusively told you, there will be a 4GB model priced at $99 with a 2-year agreement. We’re not putting our stamp of approval behind this one just yet as the tipster isn’t listed in our BGR’s Guide to respected Ninjas handbook, but it does make you think, doesn’t it?” (link)

The $99 rumor got conflated with the Wal-Mart story in subsequent reports — after all, they both came from the same blog, right? — and received what was taken by some as confirmation when Shaw Wu, an analyst who follows Apple for Kaufman Bros., addressed it in a report to clients:

“While we are not sure of exact timing, we think a $99 Apple-branded cell phone is inevitable.” (link)

Wu’s remarks were picked up by Bloomberg’s Connie Guglielmo, and by Monday they had made their way to the top of the online news food chain at Techmeme.com.

In fact, the iPhones at Wal-Mart will be sold at a discount, as VentureBeat reports and the ads leaked on MacRumor confirm: for $197  –  $2 off the $199 list price.

The Boy Genius, for his part, hasn’t backed off his initial report, but neither is he fully endorsing it. “Waiting for some feedback from a couple sources,” he wrote in reply to an e-mail inquiry. “At this point I just don’t know.”

Neither Apple nor Wal-Mart would comment on the rumors.

Despite the hundreds of customers who queued up outside Verizon (VZ) stores early Friday to buy the Storm –  Research in Motion’s hot new smartphone — the company is likely to miss its subscriber targets for the quarter that ends Nov. 29, according to a report issued Monday by Citigroup (C) analyst Jim Suva.

The Storm, RIM’s (RIMM) answer to Apple’s (AAPL) iPhone, sold out almost immediately — and that’s the problem, according to Suva.

Further investigation, he says, showed that the stores only received 40 to 100 units each, and that disappointed customers were told they could order online but wouldn’t get their Storms until Dec. 15 — too late to count in RIM’s third quarter sales.

The Storm’s late release and its limited supply were among several factors that caused Suva to trim his estimate of new subscriptions this quarter from 2.9 million to 2.7 million. He also predicts Q3 earnings to come in at $0.85 per share on sales of $2.85 billion — well below the Street’s consensus of $0.91 EPS on sales of $2.96 billion.

Among the other clouds on RIM’s horizon, as Suva sees them:

• Lack of Wi-Fi on the Storm and reviews that were “generally positive, but by no means spectacular.”
• The delayed launch of the Blackberry Bold at AT&T (T) and sales that, while “solid,” seem to be primarily replacements rather than sales to new subscribers.
• The continued unavailability of the Bold in the United Kingdom, a key European market for RIM.
• The “tepid” response to the Kickstart clamshell phone at T-Mobile (DT), which seems to be more concerned with selling Google (GOOG) G1s than RIM BlackBerries.
• A shift in thinking within corporations, which in today’s economic climate are starting to view the BlackBerry as a “nice to have” item rather than a “have to have.”

See also BlackBerry Storm: The reviews are in and BlackBerry Storm vs. Apple iPhone.

The mystery of Steve Jobs’ iPhone retail strategy deepens with reports that Apple (AAPL) will begin selling its smartphones at Wal-Mart (WMT) three days after Christmas.

According to the Boy Genius Report, a blog with relatively reliable backchannel sources at AT&T, Apple will start with select Wal-Mart and Sam’s Club outlets on Dec. 28, and eventually roll the iPhone out to 2,500 Wal-Mart owned stores.

The deal, if confirmed, would represent the fourth major expansion of the iPhone’s retail presence outside Apple’s own 200-plus stores — first to AT&T’s (T) 2,000 retail outlets, then to nearly 1,000 Best Buy (BBY) outlets (see here), and then to the tens of thousands of points of sale (many of them no more than mom-and-pop kiosks) that carry iPhones for Apple’s overseas partners.

This is a move of different magnitude. Wal-Mart is the world’s largest retail chain — by far — with more than 7,000 mega-stores around the world and some 2.1 million employees. It finished its last fiscal year with nearly $380 billion in sales – earning it the No. 1 slot in the Fortune 500.

All of which raises the question of timing. If you’re going to bring the iPhone to Wal-Mart, why not do it before Christmas — as originally rumored — rather than after?

Below the fold: An AT&T memo with a timeline of the Wal-Mart rollout, as posted Wednesday by the Boy Genius Report:

Chalk this one up to wishful thinking.

A leading Apple blog posted a rumor Sunday that the iPhone — which is currently available in the United States only through AT&T Wireless — could be coming to Verizon, perhaps as early as January 2009.

Cleve Nettles, writing in 9 to 5 Mac, says “negotiations between Apple and Verizon are ongoing but they expect to hammer out agreements by the end of the year.”

According to a “tipster” whom Nettles says “seems to know way too much about Verizon-Apple politics,” an announcement that a deal has been struck could be made at Macworld 2009.

That would be big news for millions of would-be buyers who are either locked into their Verizon accounts or reluctant to switch to AT&T (formerly Cingular), believing that AT&T’s wireless network is less mature.

But beyond the word of this unnamed tipster, Nettles’ argument rests on some pretty slender evidence.

He cites Apple job postings for engineers with experience in EVDO and CDMA, the wireless standards used by Verizon (and, for that matter, many foreign carriers). But he acknowledges that these skills overlap with those needed to work with AT&T’s GSM-based technologies and “could mean absolutely nothing.”

He also quotes Apple COO Tim Cook’s remarks that Apple “wasn’t married to the one carrier/country model.” But Cook wasn’t necessarily talking about the U.S. market; in fact, Apple has already abandoned that model in several foreign countries.

And Nettles marshals good reasons why Verizon might want to get over its initial resistance to working with Apple, or why Apple might want to reach the 55% of the domestic wireless market currently controlled by Verizon (VZ) and Sprint (S).

But he runs into a wall when it comes to what he correctly cites as the No. 1 reason people think a deal with Verizon is unlikely to happen soon: the reports that Apple and AT&T have signed a long-term exclusivity deal.

He dismisses these as “a couple of falsely reported rumors,” citing two USA Today articles, here and here.

Nettles is correct that these articles, both by USA Today reporter Leslie Cauley, are inconsistent. The first, which has been widely cited in subsequent reports, says that Apple (AAPL) gave AT&T (T) exclusive U.S. distribution rights for five years — i.e. until 2012. The second, based on an interview with AT&T chairman Randall Stephenson, says Apple got a one-year extension, to 2010.

Cauley’s reports may be inconsistent, but at least the second one appears to be well sourced, which is more than you can about Nettles’ rumor. (Pressed for detail, Nettles says that his tipster claimed to be from Verizon and therefore didn’t know much about the Apple-AT&T contract.)

If either date — 2010 or 2012 — is correct, a Verizon iPhone in 2009 is, unfortunately, a nonstarter.

According to AT&T, the outage that took down a major data network across much of the northeastern United States overnight Wednesday was brand agnostic — any wireless device using its EDGE network was affected.

But by all accounts, it was mostly iPhone users who complained — vociferously — in e-mail messages, in Twitter postings, on Apple and AT&T forums.

At DSLReports.com, where many of the early complaints were posted, there were message from the occasional BlackJack II and Nokia N95 user. But headline was “iPhone Users Greeted With Morning Outage,” and that’s who weighed in the loudest.

“This is insanity,” wrote “WildGod” at 10:23 a.m. from Brooklyn. “I never thought I would miss Verizon and my Treo as much as I do now.” (link)

iPhone owners, of course, make more demands on their cellphones than most users. But they also have a long history of complaints against AT&T, the iPhone’s exclusive U.S. carrier since June 2007, for slow and often inconsistent service.

Last week in San Diego, the second class action suit in as many weeks was filed against Apple (AAPL) and AT&T (T) for failing to deliver the “twice as fast” network speeds promised in the iPhone 3G promotional material. (See here and here.) The latest suit draws heavily on reports suggesting that heavy iPhone use is pulling more power from AT&T’s antennas than its network is prepared to provide. See Roughly Drafted for more detail.

According to AT&T spokesman Brad Mays, last night’s outage was caused by a “routing issue” that affected “some wireless data,” but not voice calling, text messaging or Blackberry e-mail.

Service was restored by 11:56 a.m. EDT.

If you’re getting bad reception on your iPhone 3G, blame your carrier, not your iPhone.

That’s the conclusion Wired.com’s Gadget Lab draws from a survey of 4,200 iPhone 3G owners. The results, posted Monday morning, show marked regional differences that Wired.com believes are primarily due to the maturity — or lack thereof — of the local 3G network, and not some underlying problem in Apple’s (AAPL) hardware.

The study, which invited users to measure their local 3G speeds and enter the data on an interactive map, was less than scientific. The participants were self-selected and a third of them provided data so incomplete the information was unusable.

But the 2,636 data points that were usable — and which Wired.com plotted on a Google map of the world — offer a window into the nature of the iPhone bandwidth problem that has drawn so many complaints.

The most striking differences in 3G reception emerged when the study compared the United States with Europe. Users in Germany and the Netherlands reported the world’s fastest average 3G download speeds — about 2,000 Kbps. The most “0″ results — indicating no 3G signal whatsoever — came from users in the United States.

Other results from the survey:

• European T-Mobile (DT) users reported the fastest 3G download speeds: 1,822 Kbps on average. [Wired notes that Europe has some of the most mature 3G networks, which have been in development since 2001. AT&T (T), by contrast, introduced its 3G network in the United States in 2004.]
• Canadian carriers Rogers (RCI) and Fido tied for second fastest with an average download speed of about 1,330 Kbps on average.
• U.S. carrier AT&T tied for third with Telstra (Australia), Telia (Sweden) and Softbank (Japan), where users reported average download speeds of roughly 990 Kbps.
• Australian carriers Optus and Virgin users reported the slowest speeds of about 390 Kbps on average.

The survey also shows striking differences from one neighborhood to another. Manhattan’s Rockefeller Center and upper Fifth Ave. got very strong signals, for example, while coverage in the rest of the city was spotty. [Reception in my Brooklyn neighborhood was reported to be particularly weak, which jibes with first-hand experience.]

One explanation for the poor bandwidth in metropolitan areas like New York and San Francisco is offered by Dave Nowicki, developer of the femtocell, a technology that extends the reach of wireless networks. He suggests that although these cities are richly supplied with 3G antennas, they are also the places where the most iPhone users reside, resulting in overloaded networks and pokey bandwidth.

This is a problem, Wired.com concludes, that won’t be easy for Apple to fix:

In our view, this data is a strong indicator that performance of the mobile carrier’s network is affecting the iPhone 3G more than the handset itself. This also furthers our thesis that it’s highly unlikely that Apple is going to wave a magical wand and say, “3G problems, be gone,” with a software update. Before Apple can make such a claim, it needs to wait for all of its carriers to optimize 3G network behavior — in terms of number of towers, how they’re positioned and how much bandwidth each tower can handle. (link)

To see the results from your city or town, click here and zoom in until the blue dots resolve into bar graphs.

Shoppers hunting for iPhone 3Gs can still find them — if they’re willing to get up early and, in some cases, drive long distances.

As of 6:00 a.m. EDT Tuesday, all three models (8GB black, 16 GB black or white) of the hot-selling device were sold out in 21 states, according to Jim Neal, a retired PR man living near Kansas City who took the time to check each of Apple’s 188 U.S. retail stores using the company’s iPhone availability widget.

“All told,” he writes, “117 Apple stores reported having sold out of all models and only 27 stores indicated they had all three models in stock.”

The states reporting no stock on hand were Connecticut, Delaware, Hawaii, Indiana, Iowa, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Missouri, Nebraska, New Hampshire, New Jersey, New Mexico, Oregon, Rhode Island, Tennessee, Utah, Washington, Wisconsin.

Apple (AAPL) advises shoppers to check availability after 9:00 p.m. the night before they visit an Apple retail store – and, if necessary, get up at the crack of dawn.

“Shipments arrive most days,” according to the site, “but be sure to arrive early since iPhone 3G is sold on a first come, first served basis.”

1,800 AT&T (T) stores also carried iPhone 3Gs, but they were “virtually” sold out the first day of sales, according to a company spokesman, and there is no word on when they will be restocked.

UPDATE: Jim Neal did another survey Wednesday morning. As of 7:00 a.m. EDT, 146 Apple stores in 23 states were completely out of stock.

UPDATE: Apple on Monday issued a press release announcing that it sold its 1 millionth iPhone 3G on Sunday. News from the company has apparently overtaken Gene Munster’s analysis, below.

“iPhone 3G had a stunning opening weekend,” said Steve Jobs, according to the press release. “It took 74 days to sell the first one million original iPhones, so the new iPhone 3G is clearly off to a great start around the world.”

Apple offered no further details. In a revised note issued later Monday morning, Munster attributed the discrepancy, at least in part, to how Apple records its sales. See here.

- - - -

In a report that will disappoint investors who were hoping for a 1-million-unit weekend, Piper Jaffray’s Gene Munster estimated on Monday that Apple and its partners sold less than half that many iPhone 3Gs worldwide in its first three days on the market

[Update: In his revised report, Munster acknowledged that "First weekend estimates exceeded our 425k estimate based on strength in international and improvement in activation process throughout the weekend."]

Still, sales were 40% higher than last year, according to Munster, who [originally estimated that it would] take Apple 17 days to sell 1 million iPhone 3Gs. Last year the company announced the sale of the 1 millionth iPhone 74 days after its first model went on sale.

“The improvement is driven by two key factors,” Munster writes. “1) international availablilty in 21 countries, and 2) a 60% lower entry-level price point.”

Piper Jaffray’s report to clients — the first detailed analysis of iPhone 3G sales — was based on observations of Apple (AAPL) and AT&T (T) stores in New York and Minneapolis, estimates of the rates of sales, the hours of operation and the number of units supplied to each store, as well as surveys of 283 attendees. It’s packed with useful information. The highlights:

• Roughly 425,000 iPhones sold worldwide in three days, despite activation problems [Update: Make that 1 million, per Apple's press release and Munster's revised report.]
• 225,000 sold in the United States, 75,000 in the United Kingdom, an average of 7,000 in each of the other 19 countries [Update: Munster now estimates that 400,000 iPhones were sold in the United States, 250,000 in the United Kingdom and an average of 18,000 each in the other 19 countries.]
• 380,000 sold in the first two days (compared with 270,000 in a day and a half last year) [No update yet.]
• Sales slowed by the approximately 15 minutes it took to activate each phone (sales at Apple stores last year took about 1 minute each)
• 66% of customers purchased the 16 GB iPhone (last year, 91% bought the top-of-the-line 8GB model)
• 38% were upgrading from the original iPhone
• 39% were PC users (versus 25% last year)
• 38% of customers in the United States were new to AT&T as opposed to 52% last year

Below the fold: details from the Piper Jaffray survey and its country-by-country breakdown of estimated sales.

I bought an iPhone for myself on Friday. This was a live blog to chronicle the event, posted in reverse order with the most recent items on top.

11:47 a.m. The iPhone just beeped. I’m in. Entered my e-mail address and the sync is in progress. That ends this blog.

POSTSCRIPT from Brooklyn: I counted roughly 230 people in line as I left the Apple Store, none of whom were among the 150 who were queued up at 5:00 a.m. (a woman coming in as I left said she’d been waiting since 7:30). I put the total count at somewhere between 380 and 500. It was a friendly, patient crowd — the usual New York mix of ages and colors — although by the time I left the people at the end were wondering how long they would stick with it if it kept moving so slowly.

Meanwhile, I still don’t have a working iPhone. The endless barber shop in iTunes has been replaced with an error message: good old unknown error (-9838). I gather from comments below and from reports here and here that Apple’s activation servers have crashed. Last year the server problems were on AT&T’s end.

10:00 a.m. On the advice of Nicki, a savvy Apple rep who seems to know what she’s talking about, I’m headed home. I can do this as well from the comfort of my leafy backyard as I can standing here.

9:38 a.m. iPhone out and plugged in. The screen is telling me to plug it in, even though it already is. But the device shows up in iTunes and I’m getting the “accessing iTunes” barber pole. I’m told by the nearest Apple rep that it’s going to be a long wait — as much as 20 minutes. Apparently a lot of people are trying to do this at the same time. Not clear if the delay is Apple’s or AT&T’s.

9:31 a.m. Authorization successful. $215.67. I sign again. Give my zip code for the fourth or fifth time. Transaction competed.

9:29 a.m. I sign the EasyPay PC for the second time. When we’re done here, I’m supposed to find an orange T-shirt for “personalization.”

9:20 a.m. Back to the Genius Bar — next to Daniel as it turns out. Since the first phone was partially activated, they have to start again with a new one.

9:18 a.m. A breakthrough! Michael reports that the long wait was due to the first AT&T operative misspelling my name (an easy mistake), which created a conflict with my social security number. I’m being sent back to the line (but at the front, not the back).

9:10 a.m. After a long wait, Michael has reached someone at AT&T named Jeffrey. They want my Social Security number again. For the fourth time. Did I mention that I’m trying to do the simplest possible purchase: a new account, one line?

9:05 a.m. Update from Daniel’s crew. His transaction is taking as long as mine. Apparently he’s trying to buy eight iPhones at once. I  wonder where the money is coming from…

9:00 a.m. It’s been a full hour now. AT&T has been doing a credit check for the past 15 minutes. These Apple people — mine is named Michael — have the patience of saints. I’m happy to have power and Wi-Fi.

8:44 a.m. We’ve had to get AT&T on the line, which means spelling out names and numbers, one character at a time, over and over. Katie Cotton, Steve Jobs’ personal PR maven, stops by to commiserate.

8:24 a.m. I’m a problem case. They’ve moved me to a separate table for special handling.

8:14 a.m. Daniel shows up. The box of apples was the last straw, but he’d pushed the security guys to the edge. He finally had to get escorted in by the NYPD. They’re a little friendlier than whomever Apple hired to do security. He’s trying to buy three phones, one for himself, one for John McCain and one for Barack Obama. We’ll have to see how that worked out.

8:11 a.m. My credit card isn’t swiping. They’re taking my information manually. Other people seem to be moving through at the rate of one every 10 minutes.

8:09 a.m. The EasyPay is having “network problems.” Someone gets another unit. Still waiting.

8:06 a.m. The roar from the Apple staff shouting and clapping is disorienting as we walk down the big circular staircase. (See video here.) We’re directed to the long table that usually houses the genius bar. I hand over my credit card and photo ID. A staffer pulls out a black box with an 8GB iPhone 3G and begins working with his EasyPay Pocket PC. It’s the start of what turns out to be a long, difficult process.

8:00 a.m. An unpleasant incident just as the doors open. Daniel Bowman Simon, organizer of TheWhoFarm group that has been here for a week, rushes to the door with a laptop, an Amerian flag and a box of apples. He’s grabbed by a security guard, who wrestles with him and then drags him off toward 58th Street. (See video here.) Everybody — the press, the Apple staff, the WhoFarmers, the people at the front of the line — is a little stunned. But the doors are open and, hesitantly at first, we trudge in.

7:45 a.m. Running low on battery. May have to pick this up after the event.

7:40 a.m. Getting closer. TV cameras everywhere you turn. CBS Early Show shows up with a team of five or six to get a shot of Greg Price, the talent, walking through the crowd. TheWhoFarm is trying — so far in vain — to pull together a press conference to publicize their online petition to turn the White House lawn into an organic farm. Harry Smith from CBS shows up in heavy pancake make up flashing a white iPhone 3G, 25 minutes before the doors open.

7:05 a.m. Greg Packer, 44, the retired highway maintenance worker who had his 15 minutes of fame in 2007 when he headed the Fifth Ave. iPhone line, (his wait: 4 days, 13 hours) has showed up in a Bon Jovi shirt. He’s still using his original iPhone, which except for some visible wear on the edges seems none the worse for wear.

7:00 a.m. The barricades are up, creating a zig-zag on Fifth Ave., and the line has moved up to fill it.

6:50 a.m. Ron Johnson, Apple’s vice president for retail, shows up. He’s whisked into the store by PR, who explain that he’s on a tight schedule and doesn’t have time to chat.

6:45 a.m. Apple employees in blue and orange t-shirts have broken out a few boxes of Smart water, preparing to hydrate the crowd, should things get hot.

6:30 a.m. The barricades are being moved into place and hooked together. The line has shifted 50 feet closer to the entrance. Much confusion as word moves down the queue. A surly looking guy in a black shirt and jeans has fallen asleep around position 11 and will not be moved. “I’m not here to buy an iPhone,” he tells everyone who asks him to move. “I just want to sleep.”

6:15 a.m. Things are starting to heat up. A dozen big guys with blue Squad Security shirts have gathered menancingly outside the metal barriers. They are threatening to move TheWhoFarm people who have been camped out here for a week and have collected a week’s worth of detritus (chairs, blankets, boxes of apples, a solar collector). The press have started to move in as well. Four satellite trucks from the networks have parked on 58th Street, their masts looming 30 or 40 feet high. Camera men with sound guys tethered to them roam up and down the line, grabbing sound bites. Every once in a while someone drives by and shouts an insult, like “get a life!”

6:09 a.m. Meet a pair of French graphic designers from Marseille who have been hanging out near the front of the line hoping to pick up a second-hand iPhone or two on the cheap. Very cheap. Clement Niviere, 20, in tight red pants, wears a hand-lettered sign on his chest that reads: “I could trade my red pants with your old iPhone (really.)” His copain, Jonas Lebesgue, also 20, wears a sign that reads “KEEP your new one, GIVE the old one.” Have they had any takers? “For the moment, no,” says Clement.

5:30 a.m. The Apple employees in front confirm what I’ve been hearing: that there were more people earlier in the night but they left when they were told they had to sign a two-year contract with AT&T in order to buy an iPhone 3G today. “We’ve been going through every couple of hours,” one tells me. “A few people left every time.”

5:18 a.m. I’m at Madison and 58th, a block away from the store, talking to the guy who’s currently the last man in line, No. 150. His name is Jason and he’d prefer to leave his last name out of it. He’s 26, from Kennebunk, ME, and he moved to New York City a few months ago to take a job at Lehman Bros., the big investment bank. In his pocket he’s carrying his first iPhone, which he bought on June 30, 2007, the day after the phones first went on sale. He’ll buy a new one today and sell his old one on Craigslist.

5:10 a.m. The Apple (AAPL) store shines like ship in the dark as I approach from the Plaza Hotel subway stop. The doors are blocked off (no bathrooms or free Wi-Fi!) and blue-shirted employees stand guard at the entrance. There are people queued up behind TheWhoFarm, but I can’t see how many.

4:45 a.m. Thinking about the report in the Wall St. Journal that the Justice Dept. has decided not to press criminal charges against Apple in the options backdating case and wondering why it came out yesterday. Nobody from the D.O.J. spoke on the record. Steve Jobs wasn’t quoted and neither was his lawyer. The source seemed to be the lawyers for Nancy Heinen and Fred Anderson, the two Apple execs who were thrown under the bus, to use the late Fake Steve Jobs’ expression. She’s off the hook now, free and clear. She must be happy she decided to fight the S.E.C. He’s probably asking himself why he caved. And mourning the $150,000 fine and $3.5 million in gains he coughed up to settle the charges.

4:30 a.m. Made a cup and drank it fast, out the door by quarter past. Caught the N train at Union St. in Brooklyn. Car full of sleeping construction workers. No sign that anyone is headed where I am. It’s not like going to a ballgame in a subway full of Yankee caps.

iPhone logic board

3:00 a.m. Up early to shower and stuff. Clearing out my e-mail. Happy to see that the flood of messages from PR firms hawking iPhone apps has slowed to a trickle and we’re back the usual krill I swim through every morning, hoping for enough protein to make it through the day. The Times is talking about rescuing Fannie Mae. Salon says Jesse Helms is not dead. A dying Thai hieress wants my help transferring $12 million to the U.S. Here’s something interesting: iFixIt has sent me a better picture of the iPhone 3G logic board. THAT I can use.