Jobs: iPhone supply may not meet demand

The number of iPhones manufactured by Apple Inc. may not be enough to meet customer demand when the smart phone goes on sale later today, CEO Steve Jobs said in an interview published today.

"We had to make our best guess as to what the demand was going to be and what supply we were going to put in place many, many months ago. We built factories to build these things and everything. We've taken our best guess, but it wouldn't surprise me at all if it ain't enough," Jobs told The Wall Street Journal.

The iPhone, which combines the functions of an iPod with a smart phone, goes on sale in the U.S. at 6 p.m. and is one of the most anticipated gadgets in recent years. Two models will be offered; the 4GB model costs $499, and the 8GB model is priced at $599. Users also have to sign a two-year contract with carrier AT&T Inc. The cost of those plans range from $59.99 to $99.99 per month.

Some prospective buyers have been camping outside stores in hopes of being among the first to own one of the new smart phones. A surge in demand for the iPhones could make the devices hard to come by at first, depending on the number that Apple and AT&T have in stock.

A shortage of iPhones would not be unusual. Vendors often have a limited number of units to sell when a new product hits the market. In the case of products where demand is particularly high, such as for new game consoles, limited product availability -- whether intentional or not -- and long lines outside stores help build buzz and generate media coverage.

Jobs also downplayed concerns over the iPhone's dependence on AT&T's enhanced data rates for GSM evolution (EDGE) network, which is slower than 3G (third-generation) networks.

"You know every [AT&T] BlackBerry gets its mail over EDGE. It turns out EDGE is great for mail, and it works well for maps and a whole bunch of other stuff. Where you wish you had faster speed is ... on a Web browser. It's good enough, but you wish it was a little faster. That's where sandwiching EDGE with Wi-Fi really makes sense because Wi-Fi is much faster than any 3G network," Jobs told The Wall Street Journal.

He said the iPhone had been designed to switch to Wi-Fi when such networks are detected.

Copyright © 2007 IDG Communications, Inc.

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