Archive for July, 2008

Belt-tightening and broadband

AT&T’s earnings report today was not as bad as some had feared. But one particularly gloomy aspect was the slow growth in broadband, one more symptom of a sluggish national economy.

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iPhone 3G confusion bigger than lines

I wish this blog was a raving (or scathing) review of the iPhone 3G, but alas I’m back from four hours in line at AT&T with nothing to show but a receipt and the promise of a shiny, new 16GB iPhone to come within the week. I’m certainly not alone either – with only 40 phones in stock at my store of choice, upwards of 100 people left in the same position.

For as many eager buyers as there were in line, there were just as many rumors and misconceptions about the iPhone making their way up and down the line. Most people waiting had questions concerning the contracts, switching providers, adding to their family plan and, more than anything, how much they would actually be spending. Most of those without questions, were relying on rumors they’d heard in the blogosphere: More shipments were coming that afternoon. (Probably not.) You could order it online within the week. (No.) You didn’t have to have an AT&T contract if you paid more out of the gate. (Nope, not yet.) Tight-lipped AT&T employees weren’t offering many answers either (although as one pointed out, Apple doesn’t like to reveal that much to them).

Most the confusion centered on the actual cost of the device, and according to Piper Jaffray analyst Gene Munster, the uncertainty might be justified. Munster predicted that only 35% of buyers will actually get the $199 price that has caused so much buzz. In a research note, he said that “though Apple advertises the 8GB iPhone 3G will sell for $199, we estimate that the average entry level price point will actually be $407.” Based on a survey of 200 mobile phone users, the firm found that a majority will not be eligible for AT&T’s subsidy and the activation fees that AT&T will be charging.

Munster predicted that because of this most buyers will wait until their contract on their current carrier expires, or AT&T subscribers become upgrade eligible. If Chicago stores are any indication of the handset’s success, however, sales for day one weren’t hurting. Granted, the supplies were low, but the demand still exceed it. More than 300 customers waited at Apple, the first arriving in the rain before dawn. Despite customers’ confusion, all were eager to get the new handset – some regardless of price or the fact that they had a perfectly good one in hand, some already equipped with new games and features from the app store launched yesterday.

AT&T wouldn’t reveal much to their confused customers. More shipments are coming, but they wouldn’t say when. Stores sold out – first of the 16GB black model, but they wouldn’t say how many each had. Considering this, it will be interesting to see if day one sales really are diluted as Munster predicts, or if it just the information given about the handset that proves to be diluted on launch day.

Did you brave the crowds and get an iPhone 3G? Have any initial reviews or launch-day stories? Please post your comments below.

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The digital divide of choice

The latest data on broadband and Internet use from the Pew Internet & American Life Project adds some interesting thought-food to ongoing discussions about the “digital divide.”


July 2008
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