Apple iPhone images burnedApple (AAPL) iPhone users already know that service on AT&T (T), Apple's exclusive mobile phone service provider, can be, well, shoddy. So is the wireless giant's online customer management system, it turns out.

A torrent of shoppers trying to order Apple's new iPhone 4 crashed AT&T's website and Apple's Web store Tuesday, generating a wave of frustration online and causing buyers to head to their nearest retailer -- with mixed success.

"We've received hundreds of tips this morning from friends near and far that iPhone 4 pre-orders aren't going through," tech blog Engadget reported. "AT&T's servers seem to be completely hosed here in America, and since Apple's own online order process has to ping those to check on your contract status, neither option is ... um, working."

One Bad Apple

June hasn't been a good month for Apple, except, of course, for the massive worldwide show of demand for its flagship product. But that aside, the company has suffered through an embarrassing iPad security breach, prompting the FBI to investigate. And the Federal Trade Commission is investigating the company's App store developer policies.

Among the iPhone 4 order snafus highlighted by gadget blog Gizmodo:
  • Multiple system errors causing apparently successful orders to be canceled.
  • Purchases that only succeed after three hours and require the use of pen and paper credit-card processing.
  • Brick and mortar AT&T stores simply closing -- in the middle of the day -- due to the system failure.
  • One reader failed to qualify for an iPhone upgrade, but was charged $300 anyway -- three times.
  • And the true shocker: Users who do manage to log into the AT&T store are directed to another person's account.
Perhaps ZDNet's Sam Diaz had the line of the day when he asked, "How does AT&T even manage to stay in business?"

Well, having a monopoly on the hottest phone on the planet helps.

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