Apple hits activation snags with some new iPhones

By Ritsuko Ando and Edith Honan

NEW YORK (Reuters) - Activation problems marred the U.S. launch of Apple Inc's new iPhone on Friday, with many eager buyers leaving stores frustrated that they could not use the hotly anticipated gadget after waiting in line for hours.

AT&T Inc, the sole U.S. carrier for the iPhone, blamed problems synchronizing the phone with Apple's iTunes online music and software store, saying it was probably caused by too many people trying to access iTunes at the same time.

Apple had no immediate comment on the problem, which appeared to be affecting users of the older iPhones as well.

"It's pretty lousy. It was not a very Apple-like experience," said Frank Beacham, a 60-year-old writer who was left with basically a so-far-useless phone after an hour spent inside a Manhattan Apple store, and a four-hour wait outside.

AT&T spokesman Michael Coe said Apple was working to resolve the problem, but he had no timeframe.

"There's been a lot of demand worldwide for the iPhone 3G," Coe said. "That means a lot of people synching with iTunes."

AT&T, which was still selling phones by mid-afternoon after selling out in some stores, advised customers to go home and activate the phone later themselves on iTunes, Coe said.

Some customers at the Apple store in New York's SoHo said Apple employees had told them the problem was with AT&T's network. Coe said he was unaware of any AT&T problems.

OLD IPHONES AFFECTED

Earlier on Friday, many customers had left stores pleased it had taken only 15 minutes to activate their new iPhones, which combine a music and video player, phone and Web browser.

"It's really great, it's a lot better than my BlackBerry," said Joshua Deutch, 31, referring to the e-mail device made by Canada's Research in Motion Ltd that is popular with corporate users.

"Launching a website takes seconds ... It's very comfortable," Deutch said. "I'm trying to get it up on my firm's e-mail and there are some hiccups here and there. But overall, it's a good experience."

But by mid-afternoon, many customers were being sent home without having activated their phones.

Some users of the original iPhone and iPod Touch, both launched in 2007, also said they were having difficulties downloading software updates so they could play video games and use other applications on their software.

While some cheerfully accepted that hiccups were to be expected during a big product launch, others were annoyed.