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iPhone 3G a Kick in the Pants for Synchronoss

Thursday, June 12th, 2008 at 9:55 AM - by

Apple's iPhone 3G will require in-store AT&T activation at the time of purchase, which means that Synchronoss just lost about 25 percent of its business, according to Silicon Valley Insider. Synchronoss is the company that managed the iTunes-based activation process for Apple's original iPhone.

The company stated earlier this year that it would be getting less business from iPhone activations, but did not elaborate on why it would see a revenue drop. At the time, analysts said that either more iPhones were being unlocked for use outside of authorized networks, or that Apple was planning on changing its iPhone activation process.

The switch to in-store activation will cost Synchronoss about US$30 million a year, and is already taking a toll on the company's stock. Compared to its 52-week high, Synchronoss is down 78 percent and is still dropping.

While the change is likely good news for Apple and AT&T since they now have one less company to pay, it's bad news for iPhone buyers that will have to deal with the same sign up headaches every other cell phone buyer encounters.

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dlstarr7 said:

member since 12 Jul 2001 with 119 posts, unranked, send him a message or view his profile

Thu Jun 12, 2008 10:42 am

So we can't buy iPhones at the Apple Store or Apple.com anymore?

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Jeff Gamet said:

member since 15 Mar 2006 with 102 posts, TMO Staff, send him a message or view his profile

Thu Jun 12, 2008 11:13 am

dlstarr7 wrote:
So we can't buy iPhones at the Apple Store or Apple.com anymore?

It looks like we'll still be able to buy an iPhone in an Apple brick-and-mortar store, but not at Apple's online store. This means Apple will need to have some kind of in-store access to AT&T's account activation system. I'm curious to see what kind of impact this has on the iPhone buying experience.

Jeff

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mshoaf said:

member since 02 Dec 2002 with 112 posts, unranked, send him a message or view his profile

Thu Jun 12, 2008 12:11 pm

According to BoyGeniusReport (I saw this via Daring Fireball this morning.), this is from an internal AT&T email:

Quote:
The new 3G device will be activated in store in both AT&T and Apple stores. Customers must accept AT&T and Apple Ts & Cs, sign a 2-year agreement, and select the data plan for the iPhone 3G before leaving the store. The current iTunes activation process will no longer be required for iPhone 3Gs, however a short tether process to unbrick the 3G device will be performed in all AT&T stores (tether cords will be provided). Apple stores will also perform this tether process, however in the event that a customer?s device is not tethered in the Apple store, their device will be inoperable until they get home and tether through iTunes. Prepaid and Pick Your Plan will not be allowed on the 3G device.

(Emphasis added.)

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dlstarr7 said:

member since 12 Jul 2001 with 119 posts, unranked, send him a message or view his profile

Thu Jun 12, 2008 12:16 pm

Interesting... It sounds like you CAN tether (with what? A normal iPod connection cord?) it at home and get it activated then?

I am taking this all with a grain of salt. At the start of the iPhone launch AT&T said that existing customers needed to come to their stores to get the phone activated, and that was all bull.

Will my wife be able to set up her new iPhone (my old iPhone) within iTunes, still?

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mactoid said:

member since 01 Feb 2005 with 29 posts, unranked, send him a message or view his profile

Thu Jun 12, 2008 1:37 pm

The other question is this: What happens if you have to do a hard reset? I've had to completely wipe my iPhone 1.0 twice in the year I've owned it (once in a hotel room on a business trip), and it would be a major pain in the derri?re to have to go find an Apple Store or an ATT store to get it reset!

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YodaMac said:

member since 21 Mar 2007 with 29 posts, unranked, send him a message or view his profile

Thu Jun 12, 2008 1:47 pm

It sure will be a pain to have to activate (or reset) at the stores, but the iTunes process was a disaster for me and it took more than two days to get activated that way. It was nuts! I was really hoping that they had solved those problems and the experience would be good this time.... ah well. Thanks for nuthin Synchronoss!

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