SAN FRANCISCO -- David Flashner thought he had it wired: Buy two iPhones last week when they first went on sale, keep one and sell the other at a profit so big it would pay for most of the first one.
Flashner wasted no time. He began advertising the extra phone while still in line at an Apple store in Burlingame, Calif., south of San Francisco. During his 21-hour wait, he posted half a dozen different ads to Craigslist - with prices ranging from $800 to $1,200 - and waited for the calls to come in.
But no calls came because consumers expect that stores will soon have phones in stock. He continued to advertise the extra phone through the weekend, and ended up with just one call, which went nowhere. On Wednesday, he returned the phone.
Flashner, 25, who manages an audiovisual equipment rental company, is not the only would-be iPhone reseller whose plan failed to follow the script. "I haven't heard of a single person who sold one," he said.
Across the nation, people looking to make a quick and easy profit bought one, two or as many phones as they could by recruiting friends to stand in line with them. Many of them were the first to get in line, camping overnight outside the stores. But now they are finding that the iPhone is much more like a Harry Potter book than a hard-to-find Wii video game machine: a great thing to be one of the first to own, but not high in resale value because supply is not constrained.
Last week, just after the first iPhones were sold, thousands of listings showed up on eBay and Craigslist, with prices of $1,000 for the 8-gigabyte phone, a $400 markup. Some bold sellers were asking $2,000. But as it became clear that supply was meeting demand, they found themselves stuck. Few of the phones have sold for more than $700, which after sales tax is not a remarkable profit margin.
Corey Spring, a columnist at newsvine.com who analyzed eBay auctions, estimated that a significant number of sellers "were only making their money back, even closing at a loss." Most Apple Inc. stores in the United States have no phones available, but the most-determined customers seem to have been able to buy phones. Few people seem willing to pay even $100 over the retail price.
Some frustrated resellers say they will keep trying, then return their extra phones within the 14-day return period.
D.J. Ostrowski is typical. Ostrowski, a 20-year-old college student who lives in Carol Stream, Ill., a suburb of Chicago, stood in line "in the hot sun" outside an Apple store for nine hours and talked a friend into joining him.
Like other resellers, Ostrowski was hoping the iPhone demand would duplicate the Xbox, PlayStation and Wii crazes. Lines are still long for the Wii gaming console, because Nintendo misjudged demand. Devices sell on eBay for around $100 more than the $250 retail price. In his ad, Ostrowski offered to "rendezvous anywhere," or even deliver the phone. The only call he got was from another unsuccessful reseller, asking if he had had any luck.
Ostrowski had used a day off from his job at a hookah bar to stand in line. Now, he said, after factoring in the money he spent on gas and the waste of a free day, he views the entire venture as a net loss. "I'm probably better off getting a side job," he said.
Sold for $1,300
A few people got lucky. Trevor Lyman, 21, a senior at Temple University in Philadelphia, sold an 8-gigabyte phone on eBay for $1,300 while waiting in line last week to buy it. He has sold two more, but for far less than the first one.
Demand for the phone was remarkably strong in the first days. Analysts estimate that Apple and AT&T; Inc. stores have sold 500,000 phones so far. One analyst ventured a guess as high as 700,000. But Apple appears to have anticipated demand and contracted with manufacturers in Asia to build far more.