500,000 iPhones 3G S Could Be Sold This Weekend Says Analyst

Gene Munster, an often-quoted senior research analyst at Piper Jaffray, is confident that more than 500,000 iPhones will be snapped within the first 48 hours after the launch of the iPhone 3G S.

While this is only half what the iPhone 3G did last year when it was released, it must be noted that the 3G S is launching in only eight countries, compared to the 21 for the iPhone 3G, and even at half a million, that would be twice what the original iPhone sold.

That said the iPhone 3G S will be on sale in nearly 90 countries in the long run (with China very likely to be in the list by next year) and will be available in all 211 US Apple stores from 7 a.m US time.

Munster was also adamant that Apple would rather comfortably reach its five million iPhone shipped for this quarter with an estimated 3 million iPhones sold in June alone, with most of it being of the older generation.

He also added that the iPhone 3G was sold at $199 when it was introduced in 2008, a 50 percent reduction compared to the previous iPhone 2G.

Coupled with the fact that the second generation iPhone added some critical features (like 3G), the "change in value proposition" for the iPhone 3G was more meaningful than for the iPhone 3G S which might explain lower sales volume.

In comparison, sales of the Palm Pre smartphone reached only 50,000 over the same time period. Furthermore, Mike Abramsky, another analyst from RBC reckons that Apple will sell up to 700,000 during the weekend.

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Our Comments

The share price of the Cupertino based company reached $137.35, a 1.28 percent rise since today's market start, in a market that showed more red than black today. Most notably, AT&T is in positive territory while Palm, Apple's most serious rival, shed more than 3 percent. We expect that many iPhone 3G will be considering whether they need to upgrade after having downloaded the iPhone OS 3.0 update over the past few hours.

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