iPhone Antenna Outcry Escalates with Recall Demand

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    NEWSLETTERS

    AP
    The news on the iPhone 4's antenna problem has reached new heights of shrillness, but this talk of lawsuits, fixes and now recalls, is 80 percent drama, 20 percent reason.

    The outcry over the iPhone 4's antenna problem has reached new heights of shrillness, as some analysts and pundits are beginning to demand a recall. It's a demonstrable certainty that holding the phone a particular way can cause dropped calls — but this talk of lawsuits, fixes and now recalls is 80 percent drama, 20 percent reason.

    Look at the contradictions: Consumer Reports refuses to give it a "recommended" rating, but nevertheless lets it keep its first-place standing in the smart phone competition.

    Analyst firm Piper Jaffray acknowledges the furor but downplays its significance saying "this PR black eye takes away some near-term upside potential to our iPhone estimates, but it does not change the long-term trajectory of the iPhone."

    Piper Jaffray guesses that the reason Apple didn't detect the problem was that all of the tester units were disguised in protective cases, ones that would have nullified the antenna fault. Echoing blogs such as Gizmodo.com, they recommend what seems to be the simplest solution, for Apple to give rubber "bumper" protectors, currently sold for $29, to disgruntled customers. (They estimate the cost to the company to be a not-insignificant $178.5 million).

    Even those most loudly calling for a hardware fix, such as Ashok Kumar, an analyst with Rodman & Renshaw, seem to understand it's not a dealbreaker.

    "They need to provide an actual fix — not a bumper fix — so that the product performs as it should," Reuters quoted Kumar as saying. "Apple should have taken a higher road when addressing the design flaw, instead of taking the hard-line stance that they did."

    Then, the hedge: "This is not a Toyota problem, but it is a problem that Apple needs to address head-on."

    All the while, people are buying iPhones in record numbers — 1.7 million in its opening week, with Piper Jaffray estimating sales of 9.5 million for the quarter ending in September — and not taking them back. If this is such a problem, where are the lines of people trying to return their shiny new phones? I called a handful of Apple Stores around the country and the employees I talked to said there was no rush of returns or surge in customer outcry.

    Meanwhile, my iPhone 4 continues to work as well as my previous three iPhones — which is to say, it's okay but not great. I have already said that Apple's biggest problem is that it didn't manage to improve iPhone calling, long the phone's biggest weak point.

    This is a far cry from the usability problems that Apple faced when it released its iPhone 2.0 software update, temporarily crippling thousands if not millions of iPhones. But that could be fixed with software. Despite Apple's statement about this being a matter of reception-bar calibration, the antenna issue cannot be fixed with software. Still, it might be the emotional Band-Aid that would satisfy some.

    According to Reuters, JP Morgan analyst Mark Moskowitz said in a client note, "Concerns around iPhone 4 reception do not appear to be impacting demand, but we think there are risks when a well-respected product rating agency such as Consumer Reports issues an unfavorable report.

    "We continue to expect a fix from Apple, whether the solution is software- or hardware-related."

    A hardware recall is unlikely and a firmware update is pointless. If Apple wants to send me a rubber bumper, I'll say thanks, but I probably won't use it, as it messes up the aesthetic purity of the new design. Meanwhile, if somebody gets to the bottom of this travesty, call me on my iPhone 4. It works fine.

    Catch up with Wilson on Twitter at @wjrothman to chat about tech (or cooking). Some tweets actually come from his iPhone 4.