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7/14/2008
02:43 PM
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Apple Says iPhone App Store Downloads Top 10 Million

The strong showing demonstrated that iPhone customers see their device as an Internet-connected touchscreen computer -- that also happens to make phone calls.

Despite iPhone activation delays that lasted over the weekend, users of Apple's smartphone and the iPod Touch downloaded more than 10 million applications from the company's new App Store, Apple said Monday.

The strong showing demonstrated how customers see the iPhone and Touch (which is an iPhone without voice communications) as personal pocket computers, and not just as a phone or portable media player, respectively. If sales continue, then Apple may be ushering in a new era in computing when people leave their PCs at home or in the office and carry mobile Internet devices for connecting to the Web on the go.

According to Apple, the company sold 1 million 3G iPhones over the weekend, which means individual customers likely downloaded multiple applications from the App Store. Apple launched the latter the day before version 2.0 of the iPhone was released on Friday. Along with the new iPhone, Apple simultaneously made the smartphone's operating system available as an upgrade to older iPhones and the Touch, giving both the same functionality, including access to the App Store.

Analysts have said that Apple is positioning the iPhone not as a mobile phone with Web access, but as an Internet-connected touch-screen computer that happens to also make phone calls. The App Store is pivotal in this transition, because useful software is what drives the sale of computers, not fancy hardware.

Apple launched the App Store with more than 500 applications built by third-party developers. As of Monday, that number had grown to more than 800, with more than 200 available at no charge and 90% of the paid software costing less than $10.

Apple chief executive Steve Jobs said in a statement that the App Store launch was a "grand slam, with a staggering 10 million applications downloaded in just three days."

Telecom analyst Jeff Kagan pointed out that it wasn't yet known how many new iPhones, which are faster than the original and sell for half the price, were sold to new customers and how many were snatched up by existing iPhone users who traded in their first-generation phone for the new model.

Nevertheless, it took Apple 74 days to sell 1 million of the original iPhones introduced last June. And even though that device was initially available only in the United States, while the new gadget launched in 21 countries, "anyway you slice it that is very impressive," Kagan said of the latest iPhone sales in an e-mailed statement.

But despite the apparent success, the launch of the new iPhone was not without glitches. Many buyers reported delays that lasted for hours in activating the device through Apple's servers, which were apparently overwhelmed. As of Monday, people who bought the iPhone online through Carphone Warehouse in the United Kingdom were still unable to activate the devices.

The disgruntled buyers launched a Web site chronicling their difficulties. An increasing number of Carphone Warehouse customers on Monday, however, reported success in finally getting their iPhones activated.

Besides activation problems, new iPhone customers on Monday complained that the device could not be used with many of the pricey charging stations, sound docks, and other accessories they bought for their iPods.

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