Apple and AT&T Stores Having Difficulty Activating iPhones (UPDATE: It's the iPocalypse)

We've heard four many accounts now from varying Apple store and AT&T locations that employees are having problems while trying to activate phones through iTunes. From Atlanta, one camper reports:

A "teal shirt" Apple representative came out to let us know they are having difficulty accessing accounts on the iTunes system. The line has been amazingly slow, but at least we are inside! In the last maybe 30 minutes only 5 people got into the store. Time to get comfy.

UPDATE: Here's the official word from AT&T:

We have had reports that customers attempting to download new iTunes 7.7 software to their new iPhone may get an error message saying "page not found." We have reported this issue to Apple. While Apple works to resolve this issue, we are asking customers to sync their newly activated phone later at home.

This does not look good. Apparently people at home can't even upgrade to firmware 2.0 and the problem is afflicting iTunes on an international scale. Here are a running tally of notifications we've received from the US:

"I was in the first group of 30 to get an iPhone 3G at the biggest AT&T Experience store in Houston, Texas. The staff couldn't get anyone's phones to activate, so they let us take them home.....where I still can't get it to activate - iTunes keeps timing out for activation, but not the iTunes store or anything else."

"Not sure if you have heard this, but I'm in an AT&T store in NJ and they can't activate the phones because iTunes is so slow. I've been waiting for 30 mins with the new iPhone attached to iTunes in the store and there is no end in sight... Have you heard about others having problems activating the phones? Sounded like other stores are having the same problem..."

"I bought an iPhone 3G and the AT&T activation isn't working. They are using iTunes to do it and there are network problems. Went home, and iTunes still won't activate. Seems to be an iTunes network issue."

"Apparently Apple completely underestimated the load on their servers for activation and ALL COMPUTERS in the Boston Apple store are stuck in the iPhone activation screen. No iTunes are able to connect to the central server, so no iPhones can be activated. "

Even the iTunes link on Apple is gone.

"I was at the AT&T store in Dublin, OH, this morning, 7th in line. They were letting people in four at a time and it took them about 30-40 minutes to get the first person done because of the servers crashing. I eventually got in and got my new iPhone, but not until almost 9:00."

"Jordan Creek in west Des Moines is down as is the Apple store. A teal shirt said that they're contemplating going with the old activate at home method. Told everyone in the line to get comfy. No one entered either store for 30 minutes"

"Atlanta update: nothing. People who went inside an hour ago are either still in there or escaped through a trap door. Three words about why waiting this year is better than last year— 'super monkey ball'"

"Apple store in Skokie<>

"iPhone 3G San Antonio: I waited about 15 minutes for activation, and nobody else's was working either so I just took my phone and left. They kept telling me that wasn't allowed, but I had already paid for the phone so there was nothing they could do to stop me."

From our own Benny Goldman in NY: "We spoke with several people who walked out of the store without a working iPhone, as the iTunes/iPhone server appears to be overloaded since around 9:45. Two people said they waited for 15 minutes without any luck, and another two were advised to try activation tomorrow. In my own experience, I left the store without activating because I thought I would do it on my laptop, but I wasn't able to. I went back inside the Apple store and didn't fare any better. We were just told by an Apple employee that they are slowing down the number of people they are letting into the store and working on the servers in order to fix the problem."

"I work for a Rogers dealer up in Canada and I just read this post and wanted to say that we’re having the same problem up here as well. Yay."

So How Did This Happen:
The source of the iTunes crash/slowdown seems not be those buying iPhone 3Gs from Apple/AT&T stores at all but the millions of people updating to the new firmware at home. Firmware 2.0 isn't like other firmwares in that it needs to update the phone and reauthenticate the service. And in turn, when the servers are slammed and the phone reaches for reauthentication, the server isn't always there to reactivate the service. This is how some of those newly bricked iPhones are occurring, and a source tells us that even first gen iPhones are susceptible.

Also, a special thanks to commenter brianhatch for the headline.