Gauging the iPhone’s popularity in Japan is not easy.

Just ask Brian X. Chen. He wrote a piece for Wired.com last April called Why the Japanese Hate the iPhone suggesting that despite the long lines that greeted the iPhone 3G last summer, the device was a big flop in Japan.

“Apple’s iPhone has wowed most of the globe,” he wrote. “But not Japan, where the handset is selling so poorly it’s being offered for free.”

Chen had to issue an apology to readers and two major revisions after his piece was torn apart in AppleInsider by Daniel Eran Dilger, writing under the byline Prince McLean, for getting initial sales estimates wrong and badly misquoting a couple key sources. But neither Dilger nor Chen had a good handle on how the iPhone was actually selling.

Which is why there was some interest this week in a survey of 2,300 Japanese retail stores conducted by the market research company BCN, reported by nikkei.net and picked up Friday by the English language TG Daily.

According to this survey, cellphone sales are plummeting in Japan but sales of smartphones have grown 80% in the past year, with Apple (AAPL) clearly in the lead.

The survey listed the top 10 bestselling smartphones cellphones in Japan. Heading the list at No. 1 was the 32GB iPhone 3GS. Second in line was the 16 GB model.

According to TG Daily, Apple has sold 1 million iPhones since July 2008 through Softbank, its exclusive Japanese carrier. But take that number with a grain of salt; it sounds suspiciously like the initial sales estimate that got Brian Chen in so much trouble last April.

No. 3 in the BCN survey is the NTT DoCoMo Aquos SH-04A, designed by Sharp. Research in Motion’s (RIMM) BlackBerry Bold came in No. 6. Rounding out the top 10 list were four smartphones made by HTC.

UPDATE: On Sunday, Asiajin’s Akky Akimoto published an analysis of the survey that provides more detail and context — and corrects several errors in the initial report.

The BCN ranking turns out to be a weekly top 10 list of bestselling cellphones (not just smartphones) for the June 22 to 28 — the week the iPhone 3GS went on sale in Japan — and it was the new iPhones, not the old, that were the Nos. 1 and 2 bestsellers in Japan that week. Curiously, the new iPhones also appeared on a BCN survey the week before they actually went on sale, coming in at No. 174 (32GB) and No. 189 (16GB), respectively.

You can see the original BCN list in Japanese here.

Photo courtesy of Information Architects.

AT&T’s (T) widely leaked “best-ever sales day” memo ticking off the records set on June 19, 2009 — the day it began selling the iPhone 3GS — is packed with superlatives but notably lacking in numbers. (See memo below.)

Unlike Apple (AAPL), which reports on a quarterly basis how many iPhones it has shipped, AT&T keeps its unit sales figures close to its chest.

The new memo trumpets the fact that iPhone sales on June 19 “exceeded sales recorded on 2008’s iPhone launch day,” without saying how many phones it sold on either day.

But by extrapolating from previous quarters and reading between the lines, we can make some rough estimates. Here are the data points as we understand them:

• June 29 and 30: Apple launches first iPhone, and AT&T and Apple together sell 270,000 units in two days.  In its Q2 earnings call the next month, AT&T CFO Rick Lindner says his company activated 146,000 iPhones in the last day and a half of the quarter.
• Oct. 2007: Apple announces that it has sold a total 1.39 million iPhones; AT&T says it has activated 1.1 million of them.
• Jan. 2008: Apple says it has sold 4 million iPhones; AT&T says it has activated about 2 million (sparking much hand-wringing about the “missing” 2 million iPhones)
• July 11, 2008: Apple sells more than 1 million iPhone 3Gs in 21 countries over the space of three days. AT&T later says its stores sold nearly twice as many iPhones that weekend as they did the weekend of the first iPhone launch. Even if AT&T’s sales equaled Apple’s, that can’t be more than 270,000.
• Oct. 2008: Apple announces that it sold 6.9 million iPhones in its September quarter. AT&T says it activated 2.4 million of them, about 35%. (Overseas sales and unlocked iPhones presumably making up most of the difference.)
• Jan. 2009: AT&T says it activated more than 4 million iPhone 3Gs in the previous six months. In that period, Apple had sold 11.25 million iPhones. Again, AT&T’s activations represent about 35% of the total.
• June 2009: Apple launches the 3GS and again sells more than 1 million iPhones in the space of three days, but this time in only 8 countries, not 21.
• July 2: AT&T’s memo says it sold more iPhones over the June 19 weekend than it did over the July 11, 2008 weekend. That makes sense, given that the U.S. (and thus AT&T) share of Apple’s sales was larger this year.

Assuming the 35% ratio holds up, it’s not unlikely that AT&T will eventually activate about 350,000 of the new iPhones sold the weekend of June 19 — many of them Apple Stores — and that actually unit sales at AT&T outlets that weekend could easily exceed 300,000.

AT&T’s public relations department announced that it sold “hundreds of thousands” through its pre-order process prior to launch, and would say no more.

Photo courtesy of AppleInsider.

Below the fold: The iPhone portion of the AT&T memo, as leaked to MacDailyNews.

I’d heard about this new iPhone app, but it wasn’t until AT&T’s (T) sales pitch landed in my inbox Thursday morning that its significance hit home.

It’s called the AT&T Navigator — a turn-by-turn GPS navigation system for your car that runs on an iPhone 3G or 3GS.  From the press release and early reviews it sounds like it’s packed with features, from voice activation and spoken directions to the ability to search for the nearest Wi-Fi hotspot and the cheapest gas.

The problem with the application is how you pay for it. Downloading the Navigator is free. Owning it is expensive: $10 added to your monthly bill — even if you delete the app — until you contact AT&T and shut off the service.

Over the life of a two year AT&T contract, this one application could set you back $240, more than you paid for the iPhone itself.

Welcome to the world of subscription pricing, one of the more than 1,000 new application programming interfaces (APIs) added to the iPhone’s software development kit (SDK) last March.

“Included in these APIs,” promised Apple’s (AAPL) press release at the time, “is the ability to leverage the incredible purchase model of the App Store within apps. In-App Purchases will allow developers to offer subscription content and provide the ability to sell new content and features in a simple and secure process.”

Senior vice president for iPhone software Scott Forstall, when he talks about subscription purchases, likes to use the example of a book publisher who might want to charge customers $10 or $15 to download a new title. That seems fair. AT&T’s Navigator does not.

[See Adam Frucci's prescient Why iPhone In-App Transactions Could Be a Disaster, posted in Gizmodo way back in March.]

CLARIFICATION: Although iPhone 3.0 allows subscription pricing, it does not permit developers to sell add-ons to free apps. As several readers have pointed out, AT&T is not billing Navigator users through the App Store; rather, it is taking advantage of its position as the iPhone’s exclusive U.S. carrier to add the fee to customers’ monthly bills.

Color me old-fashioned, but when I buy an iPhone app — or for that matter, a GPS navigator for my car — I want to own the thing outright. I don’t expect to open my wallet to a Trojan Horse that’s going to ding me $10 a month for the rest of my days.

Tom Tom, the company that was invited by Apple to demonstrate its competing navigation system at the World Wide Developers Conference keynote last month, promised to announce details regarding pricing and availability this summer but has not yet done so. If I were in the market for an iPhone navigator, I’d keep my eye on that one.

Here’s an interesting measure of how effectively Apple (AAPL) can whip the tech world into a frenzy — even without Steve Jobs there to stir things up.

According to a report issued Monday by Nielsen Online, “anticipatory buzz” in May drew more than 55.7 million unique visitors to Apple’s website — more than double that of Hewlett Packard (HPQ) and 25 times the site for Microsoft’s (MSFT) Xbox.

The buzz got even louder in June with the unveiling of the iPhone 3GS. At one point between June 8 and June 9, nearly 0.6% of the nearly 100 million blogs, groups, boards, social networks and other consumer generated media that Nielsen tracks were talking about the new device. According to the report:

“the new iPhone 3G S sent blog mentions up 1,226 percent week-over-week on June 8, the day of the announcement. After the initial announcement, buzz dipped but again picked up after the phone became available to consumers on June 19, with blog mentions more than doubling compared to the week prior.”

You can actually see Apple’s buzz machine in action in the accompanying “BlogPulse” fever chart:

Nielsen Online is a division of the research company that has been measuring — and indirectly shaping — media content since it began tracking radio audiences in the 1930s and TV shares in the 1950s.

In the promotional material on its website, Nielsen offers the schematic drawing at right to suggest how its “BuzzMetrics” data mining service extracts nuggets of intelligence by harvesting raw data from sites like this one, cleaning it up, and giving it a good polishing with its relevance and analytics algorithms.

See also:

• Live from Apple WWDC 2009
• Watch Apple’s WWDC 2009 keynote
• Lines form in Tokyo and New York
• Live from the iPhone 3GS launch
• Steve Jobs: Apple sold over 1 million new iPhones

The iPhone availability widget is back — new and improved — and it’s showing spot shortages of selected iPhones at Apple (AAPL) stores across the United States.

The availability tool, which appears on Apple’s website in times of scarcity, was last seen in the summer of 2008, when demand for the iPhone 3G was heavy and supplies short.

When it reappeared on Friday, only 29 of Apple’s 257 stores were displaying shortages of any iPhones, according to IFOAppleStore, a website that keeps close tabs of Apple’s retail business.

By Sunday morning, however, there were red “sold out” lights for selected 3GS models in all but six states.

Kentucky’s only store, in Louisville, was completely out of stock.

This year’s model of the widget is considerably more accurate than the original. Last year, availability numbers were updated at the end of each business day. This year, according to IFOAppleStore, the page is linked directly to Apple’s internal point-of-sale computers, allowing hourly updates for each store.

The shortages are all over the lot, but Apple seems to be having a particularly hard time meeting demand for the entry-level white iPhone 3GS. In Texas, the 16GB model is sold out in all but three of the state’s 15 Apple Stores. It’s not clear whether demand for that model is unusually high or if Apple just isn’t making enough of them.

To check availability in the Apple Store nearest you, click here.

AT&T (T) has had 3GS supply problems from Day 1, but the widget doesn’t cover their stores.

According to Apple, the older 8GB iPhone 3G is available in all its stores.

See also:

• iPhone 3G: Sold out in 21 states
• Where did all the iPhones go?

“Sex is everywhere these days,” we wrote in an article that nearly ended our career 14 years ago. “There’s something about the combination of sex and computers, however, that seems to make otherwise worldly-wise adults a little crazy.”

How else to explain the fuss that got made this week over an application called Hottest Girls that enjoyed a brief moment of notoriety — and an even briefer run as one of the hottest entries in the iTunes App Store.

In case you missed it, the story started late Wednesday night when sharp-eyed Apple watchers at Macenstein reported that the $1.99 app, which until that day had served up mostly photographs of young Asian women in lingerie, had changed its format and gone topless.

“And then there was porn,” wrote Dr. Macenstein in a post illustrated by a heavily Bowdlerized screengrab of what looked like outtakes from a Sports Illustrated bikini issue. He described the unveiling of the first iPhone app with nudity as “an announcement rivaling the first transmissions from the moon landing in importance.”

Never mind that photos like this would hardly turn a head on the magazine racks of Paris — or, for that matter, your average American truck stop — this story had more than bare breasts. It had legs.

Over the next few hours nearly three dozen tech bloggers felt obliged to check out the offerings at Hottest Girls and try their hand at clever headline writing:

• The Register: iPhone grows boobs at last
• Digital Daily: Sexually Frustrated? There’s an App for That
• Good Morning Silicon Valley: And wait until it gets the haptic touchscreen

MobileCrunch even ran a poll asking readers where they thought the App Store ought to draw the line. Results: 3% voted for “Bare breasts, nothing below the waist,” 18% called for “No nudity whatsoever” and 63% voted for “No limit. If it’s legal, who cares?”

Then, early Thursday, the app disappeared and the story got weirder.

“NoPorn: Apple Removes ‘Hottest Girls’ From The App Store,” was the headline of a TechCrunch piece by Robin Wauters. She bemoaned the decision by “someone over at Cupertino” to reject the iPhone’s first topless app. “So much for the grand opening of the App Store to all things naked.”

But wait! A few hours later TechCrunch’s MG Seigler, who is all over this story (his first item coined the term iPorn; his most recent asks who exactly is in charge of the App Store), ran a piece that contradicted his colleague’s.

Quoting “Allen the Geek” — the “guy team” behind the app — Seigler reported that it was the developer, not Apple’s (AAPL) censors, who pulled Hottest Girls from the App Store. And not out of priggishness, but to keep their servers from melting down under the crushing demand.

“The Hottest Girls app is temporarily sold out,” wrote the Geek team. “To answer the question on everyone’s mind: Yes, the topless images will still be there when it is sold again.”

One rule of journalism we learned the hard way is not to trust guys who traffic in porn — especially if they use pseudonyms like Allen the Geek. In a headsnapping update, Seigler had to reverse course a few hours later. It turned out Apple PR had contacted CNN.com’s Wes Finley-Price and taken responsibility for Hottest Girls’ removal.

“Apple will not distribute applications that contain inappropriate content, such as pornography,” wrote Apple spokesman Tom Neumayr. “The developer of this application added inappropriate content directly from their server after the application had been approved and distributed, and after the developer had subsequently been asked to remove some offensive content. This was a direct violation of the terms of the iPhone Developer Program. The application is no longer available on the App Store.”

This is probably not the end of the story. As long as there is money to be made marketing this material there will be entrepreneurs lining up to sell it. By Friday morning a search of the App Store for “Hottest Girls” couldn’t find the original, but did turn up 30 cheesy contenders, from “Sexy Hotties Slideshow- Free!” to “What Women Want.”

I’m not a woman and don’t presume to speak for them, but I’m pretty sure this is not what most women want.

See the blue slice in the pie chart at right? It represents the iPhone’s share of U.S. smartphone traffic on the network maintained by AdMob, one of the companies that run those little ads that appear on the screen of your mobile phone.

We’ve been watching that slice grow over the past few months. In February it covered 51% of the pie. By April it had grown to 59%. And by Thursday morning, when AdMob released the May edition of its U.S. smartphone pie, Apple’s (AAPL) share had grown to 69% — a 10 point increase in one month.

Some caveats are in order. This is just one company’s view of the mobile Web — albeit the view of world’s largest supplier of mobile ads, serving 6.3 billion banner and text ads per month. And it’s only a snapshot of the smartphones on the U.S. portion of the AdMob network — although 47.6% of AdMob’s traffic comes from the U.S. and 37.3% of that comes from smartphones.

Still, what it suggests is that Apple’s domination of the smartphone market — the only part of the cellphone market that has continued to grow in the face of the recession, according to Gartner Research — is accelerating.

How tough this makes it for the competition is even clearer when you look at AdMob’s report on the total U.S. handset market — one that includes smartphones, so-called feature phones and devices that aren’t phones at all, like the iPod touch. Apple’s share of this market, viewed through AdMob requests, is 45.1%, having grown 10.4% between April and May. Most of the other players in the field — including Research in Motion (RIMM), Samsung, Motorola (MOT) and Palm (PALM) — are showing negative growth. We’ll be watching next month to see if Palm’s share grows once AdMob starts to get data from the Pre.

Below the fold: AdMob’s worldwide data, in which Apple’s share  (31.4%) and share change (5.2%) are smaller, but the pattern is basically the same. You can see the full report here.

See also:

• The iPhone casts a giant shadow on the Web
• iPhone now represents 51% of U.S. smartphone traffic – report

With Palm’s (PALM) quarterly earnings due Thursday — along with Jon Rubinstein’s debut performance as CEO — analysts have started to place their bets on what the quarter will show.

First out of the box — or at least, first in our inbox — is RBC Capital’s Mike Abramsky, who expects investors to look past soft fourth-quarter results and focus on the potential for growth in the next fiscal year.

Specifically, his report to clients reports …

• 150,000 Pres. Having estimated that Sprint (S) sold 50,000 Pres in the device’s June 6-7 opening weekend, Abramsky now estimates total sales to date of 150,000 units (up from his previous estimate of 120,000)
• Strong demand. Citing a June ChangeWave survey that showed Palm buying intentions doubling between March and June, to 8% from 4%, Abramsky says demand for the Pre is strong and inventories low. Most Sprint stores are sold out despite daily replenishments.
• More handsets. Abramsky is expecting Palm to release a smaller $99 model before the end of fiscal 2009 and additional devices in calendar 2010.
• More carriers. In additional to Bell Canada, Abramsky is looking for Palm to strike deals with O2, AT&T (T), Verizon (VZ), Telefonica, and Vodafone by the first half of 2010.

Although interest in Palm Pre is accelerating, as evidenced by the RBC/ChangeWave chart below, it still lags behind Apple’s (AAPL) iPhone and Research in Motion’s (RIMM) BlackBerry.

Apple says it sold more than 1 million iPhone 3GSs by the end of its first weekend of sales, 20 times the number Pres sold in its debut. Apple’s number, however, covers three days of sales (vs. the Palm’s two) and includes pre-orders and units shipped to overseas carriers.

See also:

• Analyst: Palm sold about 50,000 Pres
• The Palm Pre’s soggy debut
• Apple to Palm Pre: Drop dead
• Survey: Smartphone demand accelerating
• Ex Apple hardware chief named CEO of Palm

UPDATE: Make that 1 million. See below

Piper Jaffray’s Gene Munster issued a report early Monday that may draw some attention away from Steve Jobs’ health and put it back on the bright and shiny object Apple (AAPL) released last Friday.

Munster and his team spent the day counting heads and conducting interviews with customers buying the new iPhone 3GS in New York City and Minneapolis. Among their findings:

• 750,000 iPhones. Munster estimates that Apple sold about 750,000 new iPhones over the three-day weekend, 50% more than his initial prediction (500,000) but 25% less than the 1 million iPhone 3Gs Apple sold on launch last July. It took Apple 74 days to sell 1 million first-generation iPhone and three days to sell 1 million units of the iPhone 3G.
• Shrinking windfall. Among the 256 customers surveyed, 28% were switching carriers to AT&T (T), down from 38% last year and 52% in 2007. AT&T’s iPhone windfall is shrinking.
• Brand loyalty. 56% were upgrading from an old iPhone, up from 38% last year. “We believe this shows Apple is developing brand loyalty not enjoyed by other mobile phone makers,” Munster writes.
• 16GB sweet spot. 43% bought the high-end 32GB iPhone 3GS, down from the 66% who bought the high-capacity model (16GB) last year and the 95% who chose 8GB over the 4GB when the first iPhone went on sale.
• Business users. Among customers buying their first iPhone, 12% were switching from a Research in Motion (RIMM) BlackBerry, up from 6% last year. This, says Munster, “may indicate the company is making headway among business users slowly adopting the iPhone platform for corporate use.”

Munster maintains a buy rating for Apple with a price target of $180 a share. The stock closed Friday at 139.48, up 2.6%, before the Street learned that Steve Jobs is recovering from a liver transplant.

UPDATE: Four hours and fifteen minutes after Munster issued his report to clients, Apple announced that it had actually sold more than 1 million units of the iPhone 3GS by Sunday, selling as many iPhones in eight countries as it sold in 21 last year. See here.

See also:

• Munster: 500,000 iPhones this weekend
• Live from the (relatively sedate) iPhone 3G S launch
• Inside Steve Jobs’ liver transplant

Here are two postcards from the front lines of the smartphone wars.

The first, at right, shows three college students from Monclair, N.J. — Matt Dodd, 18, Sam Epstein,18, and Keith Hobin, 19 — huddled under borrowed umbrellas in front of Apple’s (AAPL) flagship New York Fifth Avenue store to buy the latest in multitouch cellular technology.

They arrived at 7 a.m. EDT, 24 hours before Apple is scheduled to begin selling the new iPhone 3GS to the public. The heavy rain hadn’t let up since they arrived and the forecast was calling for more rain into the night.

The second, below, appeared on the Japanese website +D Mobile (English translation). It shows the roughly 200 customers who queued up Thursday morning near the Softbank flagship store in Tokyo’s Omotesando shopping district to reserve their new iPhones, which won’t arrive in Japan until June 26.

According a second report, smaller lines had also formed at Softbank outlets throughout the city and at many of the electronics stores that line Tokyo’s Akihabara Electric Town.

The guys from New Jersey, who were among the first 15 people in line at the Fifth Avenue cube last July when the iPhone 3G went on sale, say they’re here for the new iPhone, yes, but mostly for the “fun.”

“It’s an experience,” says Keith Hoban, a freshman at Drexel University. “This doesn’t happen too often. It’s nice to just hang out at the Apple store, see what happens and be among the first to get it.”