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Chronicles

The story behind the story

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iPhone mania nears fever pitch

LOS ANGELES — Christopher Parr won't go so far as to bring his sleeping bag to his local AT&T store to be first in line for Apple's coveted iPhone when it goes on sale next week.  —  But he will be there opening night to plunk down $599 for the combination iPod …

USA Today

Context & Ripple Effects

With Apple's iPhone due at AT&T stores on June 29, anticipation is running hot enough that USA Today profiles would-be buyers like Christopher Parr deciding how early to show up for a $599 device that bundles an iPod, a phone, and internet video. Apple has been adding features right up to the wire — including a confirmed deal to put YouTube on the device at shipping — while the same week it extended YouTube to Apple TV, signaling a coordinated content push across its products.

The launch is landing in a contested market: coverage notes active carrier rivalry between AT&T and Verizon around the device, and confirmed reports that growing skepticism about the iPhone is weighing on Apple's share price in a tougher stock market. Consumer mania and investor doubt are pulling in opposite directions ten days out.

First-order effects

  • Opening night turns AT&T stores into Apple's retail front line, with buyers prepared to pay the full $599 upfront for the combination iPod-phone.

Second-order effects

  • Verizon faces pressure to respond to a rival carrier getting exclusive-foot-traffic buzz, and Apple's share price becomes hypersensitive to whether launch-day demand validates the hype or the skeptics.

Third-order effects

  • If the pattern holds, handsets compete less on call quality than on bundled media ecosystems — Apple pairing the iPhone's YouTube integration with Apple TV points toward devices sold as gateways to content, a shift whose durability is the real open question given the documented pre-launch skepticism.

The trend: Mobile phones are converging with portable media players and web video platforms, with carrier partnerships and last-minute content deals becoming as central to a launch as the hardware itself.