On July 5 of last year I received the iPhone and wrote ten stories and updates about my experience with it. With today’s release of the second mobile wave from Apple, a new set of stories begins. There is no Apple store within one hundred miles of where I am spending the summer but there is an AT&T store twenty-two miles away in Mt. Pocono, Pennsylvania. I arrived at the store at 6:45 AM to get in line behind 16 people who were already camped out. I brought a beach chair and the Kindle so waiting was not so bad. The painful part was hearing them say that their systems were crashing and it was taking more than a half-hour per customer to get a phone and get it activated. With the original iPhone you could activate it yourself through iTunes but this time AT&T is taking no chances that you might hack the phone and activate it through one of their competitors. So much for the convenience of ordering and activating from home. The store opened at 8am and people were let in by security five at a time. The manager of the store went down the line outside and asked each person what they wanted, explained their various rules on eligibility, etc. They treat it as quite an honor to be able to get an iPhone — and they charge accordingly. The manager said it would take 15 minutes per batch of five people. The first person came out at around 9:30! The manager explained that they were having systems problems. That is an understatement. I would not want to be the CIO at Apple or AT&T today. A half-hour later the manager reported that the problem causing the delays was iTunes at Apple. "Everyone is trying to activate phones at the same time". What did they expect? At 10:30 it was my turn. I asked for the 16GB Black iPhone 3G, the sales associate picked up the phone to ask for it, and seconds later someone put it on the counter. It turned out to be the last one. Lucky me. I handed over my AMEX card and driver license. Then the AT&T system crashed. A half-hour later, after I had signed an agreement and charge, the sales guy said that they had discovered a shortcut that would speed things up — he could do a partial activation and then I could just sync up with iTunes to complete it. I got to the lake and discovered that the new iPhone did not yet work and the old iPhone did not either. The AT&T store had partly activated the new phone and in the process deactivated the old one. No problem. All I had to do was download the new version of iTunes and connect the new iPhone to the ThinkPad and activate with iTunes. For the next couple of hours I tried repeatedly but iTunes was not responding. The Apple servers were swamped. Bottom line after eight hours I had two iPhones that did not work. The "upgrade" cost $18 plus a new two-year commitment plus an upgrade to the monthly data plan of $15 — a 75% increase. The data plan upcharge is justified because the 3G network is so much faster than the "Edge" network that has been criticized here many times. The only thing is that the new 3G network is not available in many places. At the nine-hour mark I was able to connect to the iTunes server, activate the phone, and synchronize all my contacts, calendar, and email. This is Apple’s strength — making things easy by tightly integrating all the pieces. The downside is that you have to get locked into the "new" AT&T. I do think AT&T is improving and putting a lot of emphasis on customer service. The service question at this stage is with Apple. They have proved they are not flawless when it comes to systems management. Seamless integration of devices and software is one thing — seamless integration of millions of users all trying to connect at the same time and making unpredictable demands of the "cloud" is something much more challenging. They are not off to a good start with iPhone 2.0 after all the hype. In spite of the challenges, the iPhone 3G gives a great initial impression. There are a number of nice new features and, as predicted, a flood of new applications in the "app store" which is tightly integrated in iTunes. I am quite impressed with the first dozen or so that I have acquired. Some of them are expensive but many are actually free. I expect to see many thousands of highly useful applications that will drive millions of people to get iPhones.