Apple Inc.'s move last week to cut the price of its iPhone by $200 seems like just the inducement to persuade those on the fence to buy. But despite strong sales overall, some potential buyers -- even Apple devotees -- say the gadget still has too many drawbacks.
Cellphone users and tech enthusiasts have fawned over the iPhone's elegant interface, the luxury of having a full-blown Web browser on a phone, and the coolness of rolling several of their favorite gadgets into one. But some still won't buy it.
Apple sold its one millionth iPhone 74 days after its debut.
Sticker shock is a big impediment. Even with the price cut, the iPhone (at $399 now) is one of the pricier phones on the market. And Apple isn't offering the discounts and promotions that other smart phones and cellphones offer periodically for buyers. Also, for now, the phone is available only via AT&T Wireless. For some who now get their cell service via another provider, the hassle of switching to AT&T is enough to stop them from buying. And while some say that the email capabilities of the iPhone work well enough, many are still hesitant to leave their trusty BlackBerrys and Treos.
Still, the iPhone is selling fairly swiftly. Earlier this week, Apple announced that it sold its one millionth iPhone -- 74 days after its debut. And even with the iPhone's hefty price tag before the reduction, the phone made up 1.8% of all cellphone sales in July, the first full month of sales for the phone, according to a survey released by iSuppli Corp., an electronic research firm. It also was able to beat the sales of all smart-phone models, including the BlackBerry series, and it matched the sales of the top selling traditional cellphone model, LG's Chocolate. ISuppli estimates that 4.5 million iPhones will be shipped by the end of the year.
But even some big Apple fans are holding out. Matthew Clark, a 36-year-old director and cinematographer from Seattle, owns several Apple products including a MacBook Pro and a video iPod. A few weeks ago, he and several of his friends were out on a bike ride and decided to find a coffee shop for a break. One of his friends used his iPhone to find the nearest coffee shop using Google maps. Mr. Clark says he couldn't help but be impressed. "I thought that was pretty cool," he says.
Mr. Clark says he fell in love with the iPhone's user interface but has yet to purchase the phone. "I thought it was a little too early to jump into the technology," Mr. Clark says. "I'm waiting for things to get flushed out." He says he is waiting for a second generation iPhone to make sure he isn't taking a risk on a hip product that may still need to have some bugs worked out. And Mr. Clark says he would like to be able to choose his own cellphone carrier instead of being forced to work with AT&T should he choose to purchase the phone.
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Bruce Oksol, a 56-year-old retiree from San Antonio, Texas, has been buying Apple products since the 1980s. Mr. Oksol says he's enamored with the phone, and that Apple's Safari Web browser is the phone's most attractive feature.
Despite his fondness for the phone, Mr. Oksol says he refuses to switch to AT&T. He would have bought the phone for the original $599 price if he would be able to keep his current phone carrier, Sprint Nextel. Mr. Oksol says he hasn't changed cellphone carriers in more than 10 years, and has no intention of changing now. "You are always surprised with what you are going to get" in your phone bill when you switch, Mr. Oksol says.
This holiday season, however, he says that he may buy an iPhone for his daughter, and "let her deal with the bill."
AT&T and Apple signed a multiyear agreement where AT&T will be the exclusive provider of iPhone service. Todd Smith, a spokesman for AT&T, says some people may be put off from having to switch phone carriers, but "that's going to be a challenge for any device that is exclusive." He noted that 40% of iPhone users have come from other cellphone service providers.
After iPhone owners voiced their anger over last week's price cut, Chief Executive Steve Jobs said Apple would offer a $100 credit for all buyers who paid the original price. Apple and AT&T also said customers who bought the $599 iPhone within the past 14 days of the price slashing can choose a $200 refund instead of the $100 store credit.
Some Apple fans who did buy the iPhone say it has some kinks. Ren Finley, 40-year-old director for advanced engineering for Comcast Corp. who lives in Castle Rock, Colo., says he loves his phone. But it could be better, he says. Mr. Finley says he has to get creative maximizing the eight gigabytes of storage on his phone. He constantly has to add and delete songs and movies on his iPhone. And he isn't happy that the Web browser doesn't support Adobe's Flash technology, which causes him to miss some online video clips of his favorite cycling highlights. And Mr. Finley says that AT&T's cellular data network, called EDGE, that allows users to connect to the Web, can be a bit sluggish.
Mr. Smith, the spokesman for AT&T, says EDGE is the largest network of its kind in the U.S., and is a good choice for customers because it gives a broad range of coverage.
Mr. Finley says he's excited about potential future iPhone's models. But as for now, "I wouldn't buy another iPhone in its current iteration," he says.
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