What brought AT&T to its knees (in New York)?

For now, AT&T has halted online sales of the iPhone in New York City. Why? Obviously, there’s not enough bandwidth in New York to handle iPhone users. Why? Philip Elmer-DeWitt in Fortune:

All Things Digital‘s Peter Kafka and John Paczkowski were told independently by AT&T representatives that sales had been halted due to an increase in “fraudulent activity” in the “high-risk area” — specifically fraudulent orders made online.

Fraud? So, iPhone sales in New York must stop because of fraudulent use of AT&T’s network? Why can I still buy a BlackBerry that uses AT&T’s 3G network in New York?

There’s more to this than meets the eye. There are three rules to handle a public relations crisis (Tiger Woods, take note). 1. Tell it first. 2. Tell it yourself. 3. Tell it all.

UPDATE: The Wall Street Journal reports AT&T Resumes Online iPhone Sales. That didn’t take long.


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