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Verizon sees 'record' first-day sales with iPhone

NEW YORK (AP) - Verizon Wireless on Friday said its first day of
taking online orders for the iPhone produced record sales, and it's
stopped taking orders until Wednesday.

The cell phone carrier said that in just two hours Thursday
morning, between 3 a.m. and 5 a.m., more customers had ordered the phone than in the full day of any previous phone launch.

The company didn't specify how many iPhones had been ordered. It halted orders at 8:10 p.m. Thursday, and said it will resume taking
orders at 3 a.m. on Wednesday.

It's only taking orders from current Verizon subscribers. The
phone will be available in stores for the general public next
Thursday, but supplies are likely to be tight.

AT&T Inc. has so far been the exclusive carrier of Apple Inc.'s
popular phone in the U.S. It activated 15.2 million of them last
year. Analyst estimates for Verizon iPhone sales this year vary
widely, from 5 million to 13 million. Analysts expect the sales to
Verizon subscribers will be strong, but the big question is how
many iPhone buyers will be jumping ship from other carriers.

Barclays Capital analyst James Ratcliffe wrote in a research
note Friday that he had been expecting that AT&T would still be
able to add a net 250,000 subscribers on contract-based plans in
the first quarter, but news of the strong iPhone pre-orders on
Verizon prompted him to lower that forecast to zero.

Verizon shares fell 23 cents to $36.15 in morning trading. AT&T
shares fell 6 cents to $27.93. Both stocks are close to their
two-year highs.

Verizon is offering trade-in rebates for new customers, which
can help offset the cost of breaking a contract with AT&T. For
instance, it's offering $212 for a 16-gigabyte iPhone 4 in good
condition. AT&T's fee for breaking an iPhone 4 contract early is
$325, but that's pro-rated by $10 per month.

On Thursday, Verizon revealed that it will slow down traffic for
heavy data users on unlimited plans if they're hogging the local
cell tower. This only applies to subscribers signing up for a new
data plan, or renewing a contract. Since the unlimited data plan is
required for the iPhone, Verizon is reserving the right to throttle
all iPhone traffic.

It also said it will conserve data capacity by recoding all
online video requested by data subscribers. It said the effect on
image quality should be minimal.

(Copyright 2011 by The Associated Press. All Rights Reserved.)

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