Seven Weeks On, iPhone 3G Still Sells Out Daily

SAN FRANCISCO - Seven weeks after its launch, Apple's iPhone 3G is still selling out at stores across the country by midmorning, a run of demand that has analysts recalibrating the size of the smartphone market.

Apple sold one million of the new phones in their first weekend in July — it took the original iPhone 74 days to reach that mark — and stores have struggled to keep them in stock since.

The faster 3G wireless and a starting price of $199 with an AT&T contract have broadened the phone's appeal beyond the early adopters who camped out for last year's model. Analysts expect Apple to sell more than 10 million iPhones this year.

The launch was not flawless: activation servers crashed on day one, and a buggy software update in August dropped calls for some users. Apple pushed a fix and quietly extended return windows.

The real story, developers say, is the App Store, which passed 100 million downloads this month. Games, restaurant finders and a $999.99 do-nothing status-symbol app called "I Am Rich" (since removed) have all made headlines.

"The phone is the bait; the software is the hook," said an analyst at a technology research firm. "Apple built a computer you carry in your pocket, and the carriers get to watch."

Apple has scheduled a music-themed event for Sept. 9 in San Francisco, where new iPods — and possibly iPhone news — are expected.

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Associated Press writers contributed to this report.

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