iPhone X supply crunch means you may wait till February to get one

LOS ANGELES — The next iPhone is the most coveted new technology of 2017, and it’s going to be very hard to come by.

Production delays and pent-up demand from early adopters will cause the phone to sell out within an hour or two when it goes on presale on Apple's website Oct. 27, tech analysts say. Apple says the phone will be in stores Nov. 3, and analysts expect long lines and not much supply.

The cheaper, slightly less fancy new iPhones, the iPhone 8 and 8 Plus, went on sale over the weekend, but consumer interest was less than in prior years. Consumers are holding out for the X, which starts at $999 and has a redesigned, edge-to-edge 5.8-inch OLED screen and the ability to unlock the phone with facial features.

"We believe slow carrier promotions and relatively modest feature upgrades to the 8 are shifting demand to the X, which is a positive for Apple," says Jeffrey Kvaal, an analyst for Instinet.

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Many consumers won’t be able to find the X in stock until January at the earliest, says Gene Munster, a tech investor and analyst with Loup Ventures in Minneapolis.

“Sometime in the first quarter,” adds Jan Dawson, an analyst with Jackdaw Research.

“A good three-four months until the X is in wide supply,” Tim Bajarin says.

Apple has historically had supply issues with new phones when they are released, but the issues with the X go further. It’s using more new technology features that haven’t been ramped up to Apple-style mass production, such as the OLED screens and facial mapping modules, Bajarin says.

This will be the first time since 2009 that a fall iPhone launch has been delayed until November. The iPhone was first released in 2007 and debuted in June the first two years.

The main culprit is OLED. As smartphones have become better video devices, OLED (organic light emitting diode) represents the next step in display technology because it delivers wider and richer colors, improved contrast and better viewing angles than LCD displays.

"There is a lack of manufacturing capacity for OLED and a lower yield of screens that meet (quality) standards," Ben Wood, an analyst at CCS Insight, a research firm headquartered in London, told USA TODAY recently.

Additionally, according to the Wall Street Journal, Apple is facing shortages on certain parts that work to scan faces of users to unlock the phone.

Apple typically sells as many as 75 million iPhones (both new and older models) in the holiday quarter. .

It will have 10 to 12 million iPhone X units produced by the end of the year, but that won’t be enough to satisfy demand, Bajarin adds. “This is the hottest iPhone since the first one because of all the new technology."

Think of the presale for the X as a huge rock concert or a must-see Broadway play such as Hamilton with a scarcity of product and scalpers ready to buy heavily and make quick money.

Savvy entrepreneurs are already busy on eBay, offering the X for sale at inflated prices as high as $3,899, with one re-seller — who goes by the name Exclusive 88 — assuring customers that his network of buyers always comes through, year after year.

Dawson says the biggest benefactor here will be the iPhone 8 and 8 Plus, which start at $699 and $799, models first overlooked by many consumers. “When they see the lines for the X and that it won’t be available for Christmas, most will just buy the 8 models.”

But then again, there’s only one really all-new, re-designed iPhone, and that’s going to be at the top of many lists.

“It’s the 10th anniversary iPhone,” Bajarin says. “It really represents something significant and different. And don’t underestimate the cool factor and status symbol this will drive, especially in places like Saudi Arabia and China.”

Apple declined comment. 

© 2017 USATODAY.COM


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