On Friday (Feb. 4), after two hours of online sales, Verizon suspended pre-orders of the iPhone 4, calling it the most successful first-day of sales in the company’s history.
“In just our first two hours, we had already sold more phones than any first day launch in our history,” said Dan Mead, Verizon’s president and CEO, in a statement. “And, when you consider these initial orders were placed between the hours of 3 a.m. and 5 a.m., it is an incredible success story.”
Analysts estimate the company sold over 500,000 iPhones in the first day alone.
“After breaking its previous phone sales record in the first two hours of pre-orders, Verizon continued to take orders for 15 more hours until 8:10 p.m. ET, wrote J.P. Morgan analyst Phil Cusick in a note Monday (Feb. 7), as reported by Scott Moritz of TheStreet.com.
According to Cusick, Verizon’s previous one-day sales record was 100,000 Motorola Droids on Nov. 6, 2009 (see Droid Release). “Using the original Droid as a guide, Cusick estimated that the Verizon iPhone will be on pace to beat the Droid’s 200,000 mark on the first weekend and its 300,000 mark on the first week,” wrote Moritz. “As Cusick pointed out, this sales rate would easily beat the 1.6 million Droids sold mark for the fourth quarter of 2009.
“Analysts expect Apple to sell 11 million Verizon iPhones this year, a number that includes the iPhone 5, which is expected to be launched in July.” Pretty incredible forecasts for Apple, since it is coming off its most profitable quarter of all time (see Record Quarter) – all before this massive Verizon iPhone launch.
The general market launch for the Verizon iPhone 4 is Feb. 10, reported Andrew Berg of Wireless Week (Feb. 4). “According to a survey conducted by uSamp from Jan. 28-31, which queried over 700 smartphone users, 29 percent of AT&T customers who intend to switch to Verizon for the iPhone are willing to wait in line on Feb. 10 to get it.”
Other findings from the uSamp survey:
- Verizon subscribers: 24 percent said they are willing to wait in line for an iPhone on launch day.
- Verizon’s current BlackBerry and Android users: 46 percent of those 18-24 and 34 percent of those ages 25-34 are willing to wait in line for an iPhone on launch day.
- AT&T subscribers: 35 percent of those ages 18-24 and 50 percent of those ages 25-34 are willing to wait in line for an iPhone on launch day.
Record breaking first-day demand for iPhones is nothing new, Berg reports. “Demand for the original iPhone 4 on AT&T was so strong that online pre-order traffic actually shut down both Apple and AT&T servers. Both companies broke first-day sales records with that launch.”
Amid record sales, Verizon throttles data speeds of heavy users
“On the day that iPhone pre-orders began last week, Verizon quietly revised its policy on data management: Any smartphone customer who uses an ‘extraordinary amount of data’ will see a slowdown in their data-transfer speeds for the remainder of the month and the next billing cycle,” wroteWired’s Brian X. Chen (Feb. 7).
“It’s the old bait-and-switch. One of Verizon’s selling points for its version of the iPhone is that it would come with an unlimited data plan – a marked contrast to AT&T, which eliminated its unlimited data plans last year.”
It appears Verizon made promises it couldn’t keep and is facing a data-throttling reality that Chen calls “symptomatic of an ugly truth about the broadband industry”: Internet providers would rather slow everybody down than invest in hardware to support more customers’ unlimited use.