AT&T Stops Online iPhone Sales in New York

by Jordan Yerman | December 28, 2009 at 11:05 am

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AT&T has stopped online sales of the iPhone in New York. AT&T's only announcement so far on why iPhone New York sales are on hold is, “We periodically modify our promotion and distribution channels.” , which isn't much use to anyone. If you enter a New York City ZIP code, att.com tells youthat, sorry, no phones match your search criteria.

In my mind, this is yet another reason that carrier exclusivity is bad news for the consumer. AT&T at forst told the public that NYC was just not ready for a fancy gadget like the iPhone, as it (but somehow not Blackberries or Android phones or Palm phones) were overtaxing the AT&T network.

The decision has revived talk about whether AT&T’s network can handle the traffic generated by iPhone users, especially in dense urban markets. Owners of the iPhone tend to use the Internet much more than other wireless customers.

Well, that was their original story, but AT&T changed its tune today, saying that "increased fraudulent activity" was the reason for pulling the plug on iPhone online sales in New York. The Consumerist calls BS, though:

Residents of California, the No. 1 state on the list (with 15.8% of fraud cases), haven't been blocked from buying iPhones online. Nor have those in No. 3, Florida, which has 9.4% of all cases. And on a per-capita basis, the leaders are Washington, D.C., Nevada and Washington state -- all places where the iPhone is available for purchase online. (We checked a number of zip codes in each of these states and the District of Columbia, and the iPhone was available in all of them.)

This just doesn't make too much sense. More likely, as Consumerist says, "AT&T can't handle New York".