Apple is very good at building on momentum, whether it's iTunes music, App Store downloads or iPhone sales. There was a time when people wondered if Apple could meet its goal for iPhone sales in 2008 -- now the question is, posed by this afternoon's Q309 Earnings Report, can Apple even make enough to meet demand?

Several threads emerged from Apple's Q309 Earnings Report today. Apple is constrained in its ability to deliver iPhone 3GSs, and Tim Cook isn't sure when that situation will change. Not knowing how many could be sold makes it hard gauge demand. In a way, it's a very nice situation to be in.

iPhone sales per quarter since launch (millions)

One thing is clear, however, and that's that Apple has sold over 26 million of its smartphones the iPhone, in just 8 quarters, momentum is building, and Apple is making a lot of money. That's the kind of situation where competitors can end up fooling themselves. They might look at their own sales numbers and be happy, but maybe not so much with their revenues. Also, they may think that they have a great phone, but the carrier isn't yet ready to acknowledge that it's helping reduce the subscriber churn rate. Mr. Cook said that AT&T is, in fact, happy with exactly that.

Apple has a balanced product development schema. AT&T happiness leads to investment in more network capability. The iPhone SDK leads to a Gold Rush in iPhone apps. Patents hold the fort while innovation continues unabated. The iPhone 3G disrupts the competition's ability to compete and draws customers in to look at the 3GS. There are so many components to the iPhone product that Apple does well with, the sales picture tends to snowball at a rate that breathless competitors find hard to match. For example, Tim Cook revealed that Apple has made a pre-payment of US$500M to Toshiba for Flash memory. That kind of buying power also causes headaches for competitors and leads to more snowball effects for Apple.

The only way the competition can look at the iPhone situation favorably is to focus on piecemeal effects and isolated technical features. Time, however, has taught us that that's not going to work. Next year's chart, adding to the one above, should be equally impressive.