For Apple, a taste of humble pie

New iPhones beset by technical woes

About 50 people were outside the Apple store on Boylston at 6 a.m. yesterday awaiting the 8 a.m. opening to purchase the new iPhone. (George Rizer/Globe Staff)

Apple Inc.'s reputation for technical excellence has taken a beating in the past 24 hours. Yesterday's rollout of the company's new iPhone was marred by major technical glitches that prevented activation of new iPhones and rendered many older phones unusable. And a new Apple Internet service, called MobileMe, is also under fire for being inaccessible and unreliable.

"It was kind of a nightmare," said Kristen Bailey, a management consultant in Freeport, Maine, whose first-generation iPhone went dead when she tried to upgrade its software. "It's my only phone," Bailey said. "Our whole company runs on these iPhones." Bailey had to borrow a phone to conduct a business meeting; it took several hours to restore service to her own phone.

Meanwhile, buyers of new iPhones were being told to take them home and use their personal computers to activate them. The phones couldn't be switched on in the Apple and AT&T Inc. retail stores because server computers in Apple's activation network had broken down.

Dewayne Hendricks, chief executive of a wireless networking company in Fremont, Calif., waited in line for five hours to get the new phone, only to be sent home to turn it on. "I got back home; the server was still down," Hendricks said.

About three hours later, he was able to activate it. "This is Apple and AT&T," Hendricks said. "They should have planned it."

AT&T, the only US cellphone company that offers the iPhone, said its communications network was not to blame for the problem. "It's really an Apple thing," said AT&T spokeswoman Danielle Wuschke. Apple did not return multiple phone calls and e-mails seeking comment.

The new iPhone sells for as little as $199, compared with the minimum $399 price of the first-generation phone. But AT&T service for the new phone costs $10 more per month over the life of a two-year contract. The new contract also requires a minimum payment of $5 a month for text messaging service, while the old contract provided 200 messages free.

The new phone's data networking system offers much faster network connections than the older iPhone. Also, the new version contains a Global Positioning System chip.

Those upgrades were enough to attract crowds of early adopters to Apple retail stores throughout the world. At Boston's Apple Store on Boylston Street, more than 100 shoppers waited early yesterday in a line that wrapped around the block. The line was smaller at an AT&T retail store down the street, but still numbered in the dozens.

"I would have thought that Apple and AT&T would have anticipated this and done something to make this a little smoother," said Shiv Bakhshi, a wireless phone researcher for IDC Corp. in Seattle. But Bakhshi added that he wasn't surprised. "With everybody jumping on to the Web at the same time, there are going to be delays and glitches," he said. "A rollout like this going smoothly would have been the real miracle."

Opening-day problems are becoming more common with the rise of network-based products. Last month, millions tried to download an upgraded edition of the free Firefox Internet browser, in a successful bid to set a world record for the most downloads of a file in one day. But many downloaders encountered lengthy delays, as their file requests outstripped Firefox's server capacity.

Last year's release of the original iPhone also featured a host of network problems. Customers complained that they could only activate the iPhones at their homes, not in Apple or AT&T stores; in addition, many customers found the home activation process too cumbersome. This year, Apple had hoped to smooth the process by allowing customers to have their phones activated right in the store, with help from trained sales representatives.

But this year's iPhone rollout was complicated by the release of iPhone 2.0, a software package that upgrades the original iPhone. As a result, Apple's server network was hammered by thousands of customers activating new phones and thousands upgrading their old handsets. In addition, Apple last year launched the iPhone only in the United States. This year's new version was released simultaneously in 22 countries.

Buyers of new iPhones merely faced delays in activating them. But older iPhones went dead if Apple's network crashed in the midst of an upgrade. The phones can be reactivated once the network is restored. But websites devoted to Apple products, such as AppleInsider.com, urged readers not to upgrade first-generation iPhones until the problem was completely fixed. As of yesterday evening, the Apple website did not mention the company's network problems.

A new Apple Internet service, MobileMe, has been plagued with problems since its Thursday launch. MobileMe is a $99-a-year service that lets users store up to 20 gigabytes of data on Apple servers and access that data from an iPhone or any Internet-connected computer. MobileMe upgrades a previous Apple online service, .Mac. But .Mac users have complained of difficulties in accessing data through the new service.

None of these problems is good for Apple's image. But Bakhshi said that if the company gets its act together, the troubles will cause little long-term damage. "I think in the larger scheme of things it won't matter," he said.

Hiawatha Bray can be reached at bray@globe.com.