Analyst: Apple sold 500,000 iPhones over the weekend

The majority of buyers were Mac users; half left another carrier for AT&T

Apple Inc. sold about 500,000 iPhones on its opening weekend, the majority of them to Mac users, a financial analyst said today.

Despite reports of sellouts at most AT&T stores -- and several Apple stores reporting Saturday night that they had exhausted inventories -- Piper Jaffray & Co.'s Gene Munster said his rough estimates put sales at half a million units. "Overall, Apple met strong demand over the weekend with adequate supply," Munster said in a client note issued late yesterday.

Munster had earlier forecast opening sales at around 200,000 units.

Piper Jaffray analysts also polled 253 iPhone buyers at stores in New York, San Francisco and Minneapolis and found that 75% identified themselves as Mac users; the remaining 25% said they used PCs, presumably ones running Windows. If Apple can migrate its Mac-owner-style loyalty to the mobile phone business, said Munster, it could become a powerful player.

"One of Apple's distinguishing features, is its high level of brand loyalty amongst its user base. We believe this will be a characteristic of Apple's business in the phone market that differentiates the company from its competitors," said Munster. "If it can achieve this in the phone market like it has in the PC market, brand loyalty will be a competitive advantage that Apple develops over time."

The Piper Jaffray presales poll also spotted an overwhelming demand for the higher-priced 8GB iPhone; 91% of those surveyed said they were planning on purchasing that rather than the 4GB unit, which sells for $100 less.

Just over half of the people polled said they were switching carriers to AT&T Inc. to use the iPhone. That number was lower than other estimates, including one made two weeks ago by a market research company. Then, Seattle-based M:Metrics said two-thirds of the people expressing high interest in the iPhone were tied to AT&T's rivals. Among handsets, Motorola Corp. took the biggest hit among iPhone buyers: 35% of buyers said their old phone was a Motorola.

Munster's earlier estimate that Apple will sell 3.2 million iPhones during 2007 remains intact, he said; Piper Jaffray, meanwhile, maintained its "Outperform" rating for Apple shares.

Copyright © 2007 IDG Communications, Inc.

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