Profiteers flipping iPhone 6 units to Chinese reportedly to blame for fight at Apple Store
A combination of iPhone 6 launch supply constraints and a modified international rollout schedule have reportedly resulted in a fistfight at a Connecticut Apple Store, where out-of-town groups looking to profit on gray market resales vied for the short-stocked smartphone.
While profiteers are not an uncommon sight at Apple's product launches, multiple reports over the weekend described an increase in iPhone-flipping operations for the latest iPhone 6 and 6 Plus, including well-organized buying groups.
With no release date announced for China, which was included in the iPhone 5s rollout in 2013, customers in the country eager to get their hands on the latest iPhone 6 and 6 Plus are paying top dollar for handsets sold in one of Apple's nine launch countries. A report last week claimed Apple had received one of two Chinese regulatory certifications to start sales in the country, but a firm date has yet to be announced.
The unique circumstances surrounding this year's launch have created a small cottage industry for iPhone resellers and according to Bloomberg, tensions are running high. The publication on Monday reported about a fistfight that broke out between two groups of organized iPhone flippers at a Connecticut Apple Store. Local police said more than a dozen people from two rival New York operations came to blows over a spot in line, leading to the arrest of three individuals.
Those involved in the altercation planned to buy the iPhone 6 or iPhone 6 Plus, then resell the smartphones to customers in China, said New Haven Police Department spokesman David Hartman.
"It's our understanding that the markup on these phones when they're resold in China can be upwards of 300 percent," Hartman said. "For the most part, the dozens and hundreds of people who are waiting in line are just doing that."
On Saturday, filmmaker Casey Neistat posted to YouTube a video documenting the scene outside a New York Apple Store on the eve of launch. In the short film, a large number of line-waiters — including the first woman in line — were seen purchasing two off-contract iPhones in all-cash transactions, only to immediately hand them over to an unknown figure outside the store. Later shots showed these intermediaries carrying satchels full of iPhone 6 units presumably bound for resale on the gray market.
It should be noted that while the piece concentrated on line-waiters of Chinese descent, many of whom did not speak English, the issue is in no way limited to this demographic.
AppleInsider received unconfirmed reports over the weekend describing identical scenes in Australia, New York and other major metropolitan areas.
In one case observed first-hand, a group of at least 15 people stood in line on launch day with the express intent of buying and reselling iPhones to overseas customers. The operation was organized by a single ringleader located in Cambodia who hired a stateside underling tasked with gathering bodies for a large-scale buy of at least 30 units.
Individuals in the group were supplied with new American Express credit cards and a list of iPhone 6 choices from buyers assumedly living in an area where the iPhone 6 is not yet available. A look at one list showed 16GB models from AT&T and Verizon were first picks because tax on higher-capacity models cut into profits. Following purchase, the cards were gathered along with the merchandise. Members of the group denied requests for comment.