AT&T Resumes Online iPhone Sales in New York

UPDATED: AT&T is again selling the Apple iPhone to online shoppers in New York City, following a brief period over the weekend and Monday when the popular device had been unavailable.

A company spokeswoman declined to comment on the reason for the suspension, though a customer service representative said it had been due to several incidents of fraud in the metropolitan area, telling InternetNews.com that the device had still been available in physical stores in New York at the time.

As of late Monday morning, the iPhone had not been available for ZIP codes in each of the five boroughs, and was also off limits to customers in Suffolk County, which spans much of the western half of Long Island. During the temporary suspension, shoppers in New York City attempting to order an Apple (NASDAQ: AAPL) iPhone through AT&T's Web site received a message reading, "Sorry this Package is not available in your area."

AT&T (NYSE: T) did not immediately respond to requests for comment on what issues had been resolved to resume sales in New York.

The move to quietly -- if temporarily -- cease online sales of Apple's iPhone had fueled the latest wave of speculation about the strength of the carrier's wireless data network, despite an AT&T service representative having earlier told InternetNews.com that the decision had nothing to do with network issues.

"This is only to do with the fraudulent activity in this city," the representative said. "There are a few other ZIP codes that do not have the iPhone available also," though she could not name which ones. AT&T's Web site indicated that the iPhone had still been available for online ordering in other major cities, including Los Angeles, Chicago and Houston.

The No. 2 U.S. carrier has so far not officially addressed the decision to halt online sales in the New York area. Alexa Kaufman, a spokeswoman for AT&T, told InternetNews.com, "We periodically modify our promotions and distribution," but declined to comment on the nature of the fraudulent activity the customer service representative described.

In the absence of a more thorough explanation of the situation from AT&T, numerous bloggers have seized on the incident as the latest disappointment from the iPhone's exclusive U.S. carrier, which has long been criticized as offering shoddy network coverage and lackluster customer service.

Not helping things was a report on the Consumerist blog, which quoted an AT&T sales representative explaining that "New York is not ready for the iPhone. You don't have enough towers to handle the phone."

AT&T's network issues have not been lost on its rivals. Verizon Wireless has built an extensive ad campaign around the issue, boasting that its 3G network is five times larger than AT&T's.

AT&T responded with its own campaign, enlisting actor Luke Wilson to try to set the record straight. It also sued to knock Verizon's ads off the air, though the HYPERLINKrolling out an iPhone app that enabled customers to report dead zones.

Amid the ongoing reports of AT&T's network troubles, speculation continues that Apple might break off its exclusive arrangement with the carrier when its contract ends next year and sign on with Verizon, the nation's largest carrier and a joint venture of Verizon Communications (NYSE: VZ) and Vodafone (NYSE: VOD).


iPhone, Apple, Verizon, AT&T, New York