Apple’s failed iPhone 3G launch a golden opportunity to drop AT&T?

July 11, 2008

Apple's failed iPhone 3G launch a ploy to drop AT&T?If you were one of the many that ventured to your local Apple store to pick up the iPhone 3G, you might have noticed or heard that many early adopters have not been able to activate their shiny new handsets. The question on everyone’s mind is this: was it Apple’s fault or AT&T’s?

Venture Beat‘s MG Seigler was present at the launch, along with a video camera, which caught the frustrations of many would-be iPhone 3G owners — that’s right, there were plenty of folks who just can’t get iPhone 3Gs because of the horrible debacle that is the activation process. Though Apple’s credit card machines were down, multiple employees were unable to activate the handsets and resorted to telling people to try again from home later.

Because of the time spent trying to activate handsets for everyone, many folks were bound to stand around in line without getting a handset all day. Robert Scoble, amongst others, was on scene to experience the frustration first-hand as well.

Seigler suggests that the complete failure that is the iPhone 3G launch seems almost too perfectly impossible. Consider this: what is the one thing holding back the iPhone from completely dominating the cell phone world? The ole’ ball-and-chain, AT&T.

Unfortunately, AT&T has that whole exclusivity agreement written in ink. However, if there was a way Apple could effectively read between the lines, or exploit the fine print in the exclusivity agreement, wouldn’t it seem wise to drop AT&T as an exclusive carrier in favor of distributing iPhones to other GSM carriers? Seigler writes:

This is such a failure that I almost want to go conspiracy theorist and postulate the perhaps Apple is making this process fail on purpose so it can initiate some sort of opt-out clause of its deal with AT&T and thus spread the iPhone to other carriers. Such a move could very well lead to Apple taking over the carrier industry in the United States similar to how it took over the music industry.

If this is in fact AT&T’s fault (and that is not yet clear), Apple should walk away right now. AT&T also failed them last year with aspects of the activation process, including the transfer of numbers.

And what better way to walk out on an exclusivity agreement than to point to the fact that AT&T’s failure to prepare for the activation process of Apple’s new 3G handsets caused the launch to flop? The icing on the cake would be if stock prices plummeted from the failed launch.

Jobs has never been a huge fan of AT&T, and most certainly wasn’t happy when Cingular (the company Apple originally agreed to distribute the iPhone with) was taken over by AT&T. If the reason behind choosing Cingular was because Jobs wanted a small carrier so both Apple and Cingular would profit from the venture, no doubt His Stevesness wouldn’t feel remorse for taking advantage of a this bad situation and opening the iPhone to other GSM carriers.

If that were to happen, competing handset manufacturers would be in a serious pickle. The only wiggle room that such manufacturers have against Apple right now is the exclusivity agreement with AT&T. If that were to dissolve, you can expect to see an iPod-like revolution of the industry — an iPhone in every American’s pocket.

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7 Responses to “Apple’s failed iPhone 3G launch a golden opportunity to drop AT&T?”

  1. Big Willie:

    In your dreams! It’ll never happen!!!

  2. dylan:

    i just got back from waiting in line for the iphone. I went at 4, was there until 1:30 in the morning at which point they said AT&T shut down their servers.

    I just stood in line for 10 hours with nothing to show for it besides a white reserved card. So at least I can go back tomorrow without waiting in line.

    This is absolutely AT&Ts fault. Apple kept its store open with employees there until 1:30 AM to try to service us all. But, they simply couldn’t because AT&T wouldn’t let them.

    This is the biggest failure on AT&Ts part that I have ever seen in this industry. Taking 30 minutes to an hour PER PERSON to activate. Absolutely unacceptable.

  3. Ken:

    I guess they took the iTune servers offline as well to make it more believable.

    http://www.engadget.com/2008/07/11/itunes-activation-servers-go-down-iphone-3g-customers-being-sen/

  4. Chuck Farley:

    Failed launch? Are all Aussies as retarded as you? What a fool you are!

  5. applesux:

    Apple f’d it up by realeasing the 2.0 firmware on the same day. ATT did everything right in the activation process. They just couldn’t get iTunes to work (which is the last step in the activation process). All you rose-colored glasses, apple worshipers need to get a grip.

  6. tankilo:

    I’m lead to believe that what TMobile calls their “3G” is differnet from what ATT calls their “3G”. So if you were just using the phone in the United States, the “3G” part of the new iPhone3G can only be used on ATT.

    If they came out with a CDMA iPhone, that would be another story entirely.

  7. staffordaz:

    Minor note for correction, AT&T did NOT acquire Cingular. It was the other way around. AT&T split off it’s wireless business, which was then purchased by Cingular (purchased for $41 billion).

    Facts are important when making up conspiracy theories.

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