IPhone 3GS sells 1 million in first three days

MOBILE: Apple also reprices older version of mobile to $99

By Jennifer Netherby -- Video Business, 6/22/2009

JUNE 22 | MOBILE: Apple said Monday that it sold more than 1 million iPhone 3GS phones during the first three days the new faster model was available in stores. At the same time, a new report out from NPD Group predicts the new $99 entry-level price for the older 8GB iPhone will convince even more consumers to jump on the bandwagon.

Apple’s new iPhone 3GS went on sale Friday in a 16GB version for $199 and 32GB version for $299, with a two-year contract from AT&T. The new models include faster speeds, a video recorder and an upgraded 3-megapixel camera.

Apple CEO Steve Jobs, who has been on medical leave since earlier this year but is expected back at the company later this month, commented on the swift sales. “Customers are voting, and the iPhone is winning. With over 50,000 applications available from Apple's revolutionary App Store, iPhone momentum is stronger than ever," he said in Apple's statement.

The launch didn’t go off without a hitch, however. Some users faced up to a 48-hour delay before their new phones could be activated by AT&T. Apple issued a $30 iTunes credit to those affected.

Meanwhile, 6 million previous iPhone users downloaded the updated iPhone 3.0 software, enabling them to download movies and TV shows directly to their iPhones as well as adding other capabilities, such as cut and paste.

Also on Friday, Apple slashed the price of its older 8GB iPhone 3G model to $99, which could drive up the number of iPhone owners. A report out from NPD Group today says that “high price” was the No. 2 reason consumers gave for not buying an iPhone, cited by 42% of those surveyed. The most common reason for not buying the phone was “lack of interest,” cited by 55%. Other top reasons were the high cost of the data plan for the phone and not wanting to switch mobile phone carriers. IPhones are available only with service from AT&T.

“The iPhone 3G's original price of $199 set a smart-phone benchmark,” NPD director of industry analysis Ross Rubin said. “Halving that price to $99, while adding more features, should significantly expand the market for Apple's smart-phone.”

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