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Dec. 28, 2009

Some reports have started circulating that AT&T has stopped selling the Apple iPhone in the New York metropolitan area through its Web site, perhaps due to data congestion, credit card fraud, or routine sales strategy changes.

Reports are sketchy for now but overall, online sales of the smartphone were apparently suspended yesterday.

Prospective customers attempting to buy an iPhone through the website and using a New York area ZIP code get a message saying, "We're sorry, there are no Packages or Deals available at this time. Please check back later."

But changing to a ZIP code in other U.S. metro areas offers a whole slew of iPhone choices.

One AT&T customer service representative hinted that data congestion may be the reason for the suspension, saying that "New York is not ready for the iPhone. You don't have enough towers to handle the phone."

An AT&T representative's statement suggested that the move to not offer any iPhones online to buyers in New York was a routine strategic decision.

"Overall, we periodically modify our promotions and distribution channels," said Fletcher Cook, an AT&T spokesman.

Nevertheless, AT&T customer service representatives, who are likely not authorized to comment officially for the company, painted divergent pictures, depending to which one you happened to talk to yesterday.

In light of AT&T's tarnished reputation for its very slow and erratic 3G service on the iPhone, this is certainly a plausible explanation. For more than 13 months now, iPhone users have repeatedly complained about dropped calls, slow signals, erratic connections and overall poor service on the 3G network.

Many of the problems appear to be particularly worse in densely populated urban areas, such as New York City, San Francisco, Los Angeles, Dallas and other major U.S. cities.

But another AT&T representative suggested that credit card fraud is also responsible.

Online sales were suspended due to "increased fraudulent activity in the New York area when ordering the iPhone," the other AT&T representative said.

But Apple's iPhone 3G S is apparently still for sale at Apple stores in the New York area, which would confirm that there's been a rather large amount of online and credit card fraud through AT&T's website.

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Source: AT&T.