iPhone glut forces price crash on eBay

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With iPhone fever sweeping the US last weekend, several lucky early adopters saw the opportunity to cash-in on their purchase by reselling it on eBay for a quick and tidy profit.

However, this plan seems to have backfired for many, as research by a US journalist has shown that iPhone sales on the eBay auction site are going for an average profit of just $54.43 - with some even selling at a loss.

Corey Spring analysed the final selling price of 993 iPhone eBay auctions that took place on Sunday, just two days after the iPhone launched. The vast majority of the iPhones being sold were the premium 8GB version, which had a retail price of $599 plus US sales tax, but they certainly didn't attract a premium price tag.

Despite reports of iPhones changing hands for thousands of dollars on the auction site, more than half of the auctions Spring surveyed failed to attract a single bidder. "Among those auctions that did close successfully, few were having the large markup that many expected to see the iPhone go for from third-party sellers... and a significant amount were only making their money back, even closing at a loss," Spring notes on his blog.

Why has the iPhone failed to spark the usual Ebay gold rush? As we reported yesterday, sales of the iPhone have been extremely healthy, with 500,000 units being sold over its debut weekend. Unlike many new product launches, it seems Apple has sated the huge consumer demand, leaving the eBay opportunists without a market to sell to.

It looks like thousands of people are going to be stuck with an iPhone, whether they wanted it or not.

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