The new iPhone is in more than 1 million customers' hands despite server problems over the weekend.

Apple announced that it sold its 1 millionth iPhone 3G on Sunday, three days after its launch on Friday.

"iPhone 3G had a stunning opening weekend," Apple CEO Steve Jobs said in a news release. "It took 74 days to sell the first 1 million original iPhones, so the new iPhone 3G is clearly off to a great start around the world."

The updated iPhone went on sale Friday, but a server meltdown at Apple meant many users faced hours of frustration trying to get their new phones activated.

A spokesman for AT&T, the exclusive carrier for the iPhone in the United States, said there was a global problem with the Apple iTunes servers. AT&T had planned to offer in-store activation, but many buyers were sent home and told to try later.

Frederick Smalls, an insurance broker in Massachusetts, said trying to get his new iPhone to work was a study in "grief and aggravation."

Reports of activation problems subsided over the weekend.

The iPhone 3G is now available in 21 countries. In the United States, the new iPhone 3G is priced at $199 for the 8-gigabyte model and $299 for the 16-gigabyte model.

The new iPhone 3G combines all the features of iPhone plus 3G networking that is twice as fast, built-in GPS for expanded location-based mobile services, and iPhone 2.0 software, which includes support for Microsoft Exchange ActiveSync and runs hundreds of third-party applications available through the new App Store.

Apple also announced on Monday that users have already downloaded more than 10 million applications from its new App Store since its launch late last week.

The App Store features a wide array of mobile applications ranging from games to location-based social networking to medical applications to enterprise productivity tools, according to an Apple news release. Users can wirelessly download applications directly onto their iPhone and start using them immediately.

More than 800 applications are now available on the App Store, with more than 200 offered for free and more than 90 percent priced at less than $10.