Pre-Sales Show IPhone Hasn't Lost Its Groove
If there was any question of whether the iPhone had lost its hold on the imagination of affluent consumers, it appears to have been answered by the flood of pre-orders for the latest version of Apple's signature device.
The 600,000 advance orders for the iPhone 4 were 10 times that for the iPhone 3GS, and caused well-publicized difficulties for Apple in handling the record demand that quickly outpaced inventory.
Before Steve Jobs, Apple's salesman-in-chief, had unveiled the new iPhone model June 7, the buzz in the smartphone space seemed to be around Sprint's release of the HTC Evo 4G and the spread of Android phones.
Sales of Android-based devices eclipsed the iPhone in the first quarter for the first time, indicating the Google mobile platform would continue to trump the iPhone as more and more handset makers built Android into their phones.
And with the first 4G phone in the U.S., Sprint would be able to offer a competing Android device that was faster and more reliable than the notoriously spotty coverage for the iPhone supplied by AT&T. There was also the torrent of unfavorable attention AT&T attracted last week for a security hole in its Web site that allowed 114,000 email addresses of iPad customers to be compromised.
Come to think of it, the launch of the iPad itself in April had upstaged its smaller cousin, impressing reviewers with its 10-inch screen, iBook e-book reader and 10-hour battery life. Suddenly the iPhone didn't seem so sexy.
But with Job's showcasing the more angular glass and stainless steel iPhone 4, equipped with video calling capability, a high-def camera and even gyroscope for better game play, the familiar pre-release frenzy around the device began building again last week. Keeping the 16GB version of the new iPhone at the $199 price level and bumping down the 3 GS-- instead of trying to jack up the cost because of the phone's new features -- was another smart move by Apple.
Those factors, plus strong early reviews, combined to send pre-orders through the roof and lay to rest doubts about whether Apple could maintain the iPhone's cachet in an increasingly competitive smartphone market. And when the iPhone 4 hits stores on June 24, expect to see the usual lines wrapping around the block -- and surrounding media coverage befitting a big summer movie opening.
Another thing to watch in the coming weeks and months is whether the iPhone 4 has a halo effect on the 3GS, especially with the older model now carrying a lower price tag. And if there's anything to the latest report that Verizon will get the iPhone 4 in the fourth quarter, sales could get a further jolt. But even if a Verizon iPhone doesn't materialize, the product line looks like it's still got legs.