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'Fawlty Towers': AT&T Stops Selling iPhone in New York

Earlier this month, when AT&T swore to improve iPhone coverage for New Yorkers, no one expected the carrier to combat the data congestion issue by cutting off the supply of new iPhones. "AT&T has stopped selling iPhones to New Yorkers from its Web site, for unclear reasons," reports the Associated Press. The company hasn't explained the suspension, which started a few days ago.

"I guess that's one way to solve the problem," remarks The Consumerist, which broke the story on Sunday. In a written statement, an AT&T spokesman told Consumerist that "We periodically modify our promotions and distribution channels." In New York City?!

The success of Apple's iPhone has no doubt been hampered by the poor coverage of its exclusive carrier AT&T, and particularly in New York City and San Francisco. Admitting as much, Ralph de la Vega, chief executive of AT&T Mobility, recently said the carrier was "performing at levels below our standards," before vowing to make improvements.

"As AT&T continues to battle the perception, valid or not, that its network is not robust enough to handle the data-guzzling iPhone, an obstacle for potential customers in the New York City area is not likely to help," notes The Times' Bits blog.

Writes Apple Insider: "Surprised and unable to keep up with the sheer popularity of the iPhone, AT&T has flirted with the idea of introducing tiered data plans that charge bandwidth-gorging customers more, all while pumping hundreds of millions of dollars into upgrades to its 3G networks in areas of the country hit hardest by the influx in mobile activity."

Officially, AT&T is attributing its decision to momentarily stop selling iPhones online to "increased fraudulent activity," according to MediaMemo.

Residents of Manhattan and the city's other four boroughs can still purchase an iPhone directly from AT&T stores, and the city's five Apple stores.

What's more, MediaMemo finds it hard to believe that the carrier made a conscious decision to limit the supply of iPhones to ease data congestion. "That answer might strike a chord with New York iPhone owners who gripe about the carrier's capacity," it writes. "But it strains credulity: Would AT&T really try to resolve its iPhone problem by hampering iPhone sales -- and not tell anyone in advance? And if so, why not choke off online sales in San Francisco and the Bay Area, where heavy iPhone use also strains the carrier?"

Yet, an AT&T sales rep on Sunday told The Consumerist that "the (iPhone) is not offered to you because New York is not ready for the iPhone ... You don't have enough towers to handle the phone.

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