2010-06-24 14:15

Apple Inc will probably sell a record 1 million iPhones today when the new version debuts and people such as John Whalen line up outside stores to be the first to buy it.

"It's like the olden days of waiting in line for tickets to a rock concert," said Whalen, 50, publisher of Cider Mill Press in Kennebunkport, Maine. "There isn't anything I wait in line for other than the technology releases from Apple."

Chief Executive Officer Steve Jobs added video calling, multitasking and a high-definition video camera to the iPhone 4 and made it faster and thinner. The device will be available first in the US, UK, France, Germany and Japan. Apple may top 2 million iPhone sales by the end of the fiscal quarter on June 26, with half of that coming today, predicted Andy Hargreaves, an analyst at Pacific Crest Securities.

In Japan, where the new model first went on sale, about 320 lined up outside the Tokyo flagship store of wireless carrier Softbank Corp, the iPhone's exclusive provider in the country. That compared with 350 people who queued to be first to get its predecessor and 1,500 fans of the 3G version in 2008, according to Softbank spokesman Katsumasa Tochihara.

"Queuing is half the fun, it feels like you are part of something special," said 28 year-old Manabu Ishiyama, who works in retail in Tokyo, and was second in line after arriving at 8 p.m. on June 21. "The screen is incredible and it has a front- facing camera, I can't wait to try it out with Skype."

Supply the issue

Apple may sell more than 10 million units in the quarter ending in September, another record, said Colin Gillis, an analyst at BGC Partners in New York.

"Supply is more an issue than demand," said Gillis, who recommends buying Apple shares and doesn't own any.

Apple, based in Cupertino, California, is facing increased competition from Android phone makers, such as HTC Corp, which rely on Google Inc's software. There are some 60 Android-based phones and more than 60,000 applications available for them, according to Google.

"Android will absolutely cut into their market-share opportunity, but it doesn't mean Apple can't keep selling an extraordinary number of phones and probably at the highest profit margin in the industry," Hargreaves said. The Portland, Oregon-based analyst has an "outperform" rating on Apple's stock, which he doesn't own.

For now, Apple has a wide lead in applications. There are more than 225,000 apps available for iPhone users.

Wait for white

Apple fell $2.88 to $270.97 yesterday in Nasdaq Stock Market trading. The shares have risen 29 percent this year.

"We're thrilled to be launching iPhone 4," said Natalie Harrison, a spokeswoman for Apple. "We've seen incredible customer excitement in the US and around the world." The company said yesterday it's delaying the release of white models of the iPhone 4 until the second half of July because of unexpected manufacturing challenges. Jobs unveiled the phone on June 7.

Reviews of the new model have been positive. Walt Mossberg of the Wall Street Journal deemed it a "major leap" and the "best device in its class." In the New York Times, David Pogue rated it "the first phone to make good video calls."

Best seller

The iPhone, introduced in 2007, is Apple's top-selling product and accounts for 40 percent of its revenue. The company received more than 600,000 preorders for the new model, setting a single-day record and exceeding the company's expectations.

The demand may be partially triggered by the 57 percent of iPhone owners who have an older version that won't work with the new iOS 4 software, according to Katy Huberty, a New York-based analyst at Morgan Stanley. She projects that Apple may sell more than 100 million units by the end of 2011.

In the US, a 16-gigabyte model of the iPhone 4 will cost $199, and a 32-gigabyte model is priced at $299. The company is now selling its older 3GS model for $99. AT&T, which has been criticized for dropped calls, said this month it will end unlimited data plans, an effort to manage the surge in demand caused by devices like the iPhone.

‘Like Christmas'

AT&T said this week that it's delaying sales of the iPhone until June 29 because early orders depleted inventory.

"I certainly have my hang-ups because the AT&T service drops out, but it's just too good of a phone," said Justin Stockton, 34, a software developer in Boulder, Colorado, who plans to buy two iPhones today. "It's like Christmas. There is a lot of buildup and then you spend the whole morning in the moment."

Verizon Wireless, the biggest US mobile-phone carrier, will probably begin selling the iPhone early next year, Barclays Plc said in a research note this week.

The iPhone 4 design more than doubles the number of pixels per inch from the 3GS version, making its sharpness "resemble that of a printed book," said Yair Reiner, an analyst with Oppenheimer & Co in New York. It's the thinnest model to date - - 9.3 millimeters -- and has faster processing power, longer battery life and a gyroscope sensor that can track a user's movement.

"This device is just awesome," said Rento Usui, 26, a freelance developer of application software from Tokyo who joined the line at noon yesterday. "Compared with my iPhone 3G this thing is wicked fast, and on top of that there is the high definition video, in-camera and multitasking."

Cider Mill publisher Whalen lined up at Apple's Portland, Maine, store. He's been a fan since buying his first Apple computer in 1982.

"It's exciting for me to see this company that I've believed in succeed," Whalen said.