AT&T resumes online sales of iPhones in NYC

After abruptly halting online sales of the iPhone to New Yorkers over the weekend, AT&T Monday resumed selling the popular device via the Web, although the reason sales were stopped at all is still not known.

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On AT&T's Web site, prospective iPhone buyers who entered New York City ZIP codes were told Monday morning to "Please shop for another phone."

"We periodically modify our promotions and distribution channels," said Mark Siegel, executive director of media relations for AT&T Mobility said early Monday, declining to elaborate. Initial speculation is that either the wireless carrier's data network is overburdened in New York — which it has said — or that there may be a problem with credit card fraud with its online sales of the device, with a new iPhone 3GS starting at $199.

"We’re not going beyond that statement right now," said Fletcher Cook of AT&T's corporation communications. "But the iPhone is available in our New York retail stores and those of partners," which includes Apple, maker of the hugely popular device.  

AT&T is the exclusive carrier of the phone in the United States. The issue of its non-availability online in New York was raised on the Consumerist Web site after a Brooklyn man said he tried to order an iPhone through AT&T's Web site and was steered away from buying the device.

"I was on the AT&T Wireless website trying to get an iPhone," he wrote in comments shared on the site. "However, when I put in my zip code 11231, the site says the iPhone is unavailable. This seemed a little odd so I started punching in other famous zip codes: 90210, 60609 (spiegel catalog), 02134 ...

"For these cities, LA, Chicago, Boston, iPhone is available. Then I looked up some other zip codes: Dallas, Miami, St. Louis, Philadelphia, San Francisco. All those cities are ok. Then I started putting in more NYC zip codes: midtown, Staten Island, the Bronx...no iPhone available."

A writer for the Consumerist called AT&T's online sales support after trying to order an iPhone online, and said she was told that "New York is not ready for the iPhone," and that there are not enough cell towers "to handle the phone."

The iPhone is the most popular phone in the United States, according to the Nielsen Company, which recently released its year-end "Top 10 Mobiles" list. Mobile research firm Flurry estimates that approximately 14.5 million iPhones have been sold in the U.S. through October 2009.

The New York City area is well-known for dropped calls and poor service when it comes to the iPhone. While AT&T, like other wireless carriers, is constantly working to add and improve cell tower capacity, there is yet another issue for iPhone users, not only in New York City, but nationwide: the iPhone's ease of Web surfing and e-mail also has translated to its owners being intense data users, further straining the network.

AT&T Mobility president Ralph de la Vega said recently the company is considering various ways to get iPhone owners to reduce that usage. That could mean higher fees or punitive charges for those using excessive amounts of data.

But it is unclear whether the cell tower issue is the reason for AT&T's decision on online sales in the New York City area.

Yet another writer, for GearLog, contacted AT&T online sales via the Web and was told that sales were stopped because of "increased fraudulent activity in that area when ordering the iPhone."

The AT&T sales rep "told us that iPhones are still available at AT&T stores in the New York metro area. Apple's Web site had no problem selling me an iPhone for use in New York City online."

The Associated Press contributed to this report.