Apple's iPhone 4 press conference: We've got questions

The iPhone 4’s reception problems are either no big deal or a major sticking point depending on your perspective. But one thing is indisputable—the furor over the newly released phone’s antenna has become so pervasive that Apple plans to hold a rare press conference on Friday to tackle the issue head on.

Here’s what’s at stake: Since the iPhone 4’s release last month, some users have complained about problems with antenna interference. The most common complaint involves the reception bars disappearing from the iPhone’s status bar when users hold the device a certain way, with their fingers covering the phone’s antennas. That can slow or even stop any cellular data transmissions to an iPhone 4.

We’re not sure exactly what Apple is going to say at Friday’s press conference, which we plan to cover live beginning at 10 a.m. PT. But we do know what questions we have for Apple about the issue. Here’s a rundown of what we hope to see addressed at Friday’s press conference, and why we’re looking for answers to these questions.

So is the problem with iPhone reception a hardware issue or a software one?

Apple seems to have concluded that it’s the latter, if the company’s few public comments on the issue are anything to go by. On July 2, Apple put out a public statement saying that signal reception issues were caused by a faulty algorithm used to calculate bars of reception. The company has promised a software update to fix the issue—that’d be the iOS 4.0.1 update released Thursday. Our preliminary testing suggests that the update does indeed change the signal strength read-outs you’ll get from your iPhone 4 (not to mention your 3G and 3GS), but that gripping the new phone a certain way can still cause signal strength to fall—or disappear completely—especially if your signal wasn’t strong to begin with.

Besides, claiming that this is primarily an algorithm issue doesn’t square with what a number of iPhone 4 testers—including our own iPhone 4 review—have concluded. Holding the phone along its lower left corner results in significant signal loss for some users—a problem that would seemingly have something to do with where Apple placed the antennas on its new phone. Consumer Reports was the latest publication to reach this conclusion when it announced this week that its testing concluded that the problem was with the iPhone 4’s hardware, not its software.

Apple needs to clarify on Friday what it believes is causing the issue. If the company still maintains that it’s a software problem, it needs to make a very convincing case for that position. Late on Thursday, the New York Times reported that the problem might be fixable via software. Perhaps that will be part of the story on Friday.

Did Apple know about the signal reception issue before it shipped the device?

It’s difficult to say. A Bloomberg story published on Thursday suggests that Apple engineer and antenna expert Ruben Caballero warned Apple management of potential reception problems last year. The piece also claims that a carrier partner of Apple’s voiced concerns before the phone’s release as well. But Apple denied the Bloomberg report in a statement to the Wall Street Journal.

How did this happen?

If Apple’s denial to the Wall Street Journal is true, that still doesn’t address the issue of how the iPhone 4 made it through Apple’s testing process without the reception problem appearing—or appearing with enough frequency to raise any red flags about the phone. Apple will be hard-pressed to explain how it didn’t spot the issue. (No left-handed testers? Was anything different in iPhone 4 development versus other phones?) We know that there were phones out in the wild prior to release—remember this spring’s furor over the misplaced iPhone prototype? We also know that, because of secrecy concerns, Apple tested those pre-release iPhone 4 units in cases designed to make them look like an iPhone 3GS. Given the evidence that Apple’s bumper cases prevent the signal attenuation, it’s possible these test cases created a similar effect. Perhaps Apple can shed some light on this issue Friday.

What’s the proper way to hold an iPhone?

Steve Jobs infamously told an iPhone user experiencing poor reception to “just avoid holding it in that way,” referring to touching the two antennas in the lower-left corner of the device. It will be interesting to see what Apple says about holding the phone, and if there are any particular Apple-approved grips for the device, at the press conference. Chances are good, though, that what Apple will say is that in areas of good reception, it won’t matter how you hold the phone, and if you put on a case, it also won’t matter. It’s only when reception is poor and you’re handling a bare phone that the iPhone 4 experiences signal loss.

What about problems with the iPhone 4’s proximity sensor?

Dropped calls from disappearing cellular signals have grabbed most of the attention with the iPhone 4, but it’s not the only problem facing the new phone. Some users have also complained of problems with the proximity sensor—the sensor the iPhone uses to detect when you hold the device up to your face. When the iPhone gets close to your face, the proximity sensor is supposed to turn off the display, so that you don’t inadvertently hang up on your call when your cheek hits the screen. But on some iPhone 4 models, the sensor is apparently getting stuck—either it doesn’t turn off the display when you hold the phone to your face, or it doesn’t re-activate the screen once you move the iPhone away from your face.

Apple needs to confirm how widespread an issue this is and how it plans to address the matter for users reporting problems with the proximity sensor in their phones.

Has this situation hurt Apple’s credibility?

Apple sold 1.7 million iPhone 4s in the first four days of the phone’s release, making it the most successful product launch in the company’s history. People lined up at Apple Stores around the country on launch day to get their hands on the phone, a fact that certainly generated a lot of positive buzz about the product. And to be sure, a lot of those customers are quite satisfied with their purchase, if the feedback in our forums is anything to go by.

But just as assuredly, those customers affected by iPhone 4 reception issues probably aren’t pleased with their new phones and even less satisfied with how Apple has handled the matter. Getting the company to comment on the issue beyond its few public statements has been a fruitless effort. We have to wonder if this cone-of-silence strategy was the best way to treat early adopters who helped the company record such a successful product launch. To put it another way, Apple seems perfectly happy to tout the number of people that lined up to buy its new phone, but less willing to address the segment of those customers who ran into problems with the product. Is Apple worried that its behavior might cause early adopters to think twice about buying Cupertino’s next offering on launch day, thus impacting future product launches?

How does Apple plan on fixing the problem?

Well, that’s the $1.5 billion question, isn’t it? (That’s the estimated cost, according to Sanford C. Bernstein analyst Toni Sacconaghi, of an iPhone 4 recall—a scenario we’d guess is unlikely and that the Wall Street Journal reports won’t happen, citing “a person familiar with the matter.”)

Most likely, Apple will admit that touching the iPhone 4 in a certain way will reduce its signal, and that in areas with poor signal quality it can lead to dropped calls or a loss of data transfer speed. But the company will probably downplay the issue, saying it’s a relatively rare occurrence in the real world. It’s unlikely that the company will recall all existing iPhone 4 models, though it’s possible it may modify new iPhone 4s to reduce or eliminate the interference. (If the company did that, it would almost certainly have to offer a trade-in plan for existing phones, but it could potentially avoid using the term “product recall.”)

More likely, Apple will simply offer a sop to customers who are experiencing problems. Since our tests (and those of Consumer Reports) show that the problem is largely solved by placing an insulator such as one of Apple’s $29 iPhone Bumpers around the phone, it seems plausible that Apple will offer iPhone 4 buyers who are experiencing the problem a free iPhone Bumper or even a simpler accessory that will cover the affected area. For what it’s worth, Piper Jaffray analyst Gene Munster thinks Apple could offer a free in-store fix to existing iPhone owners, in which Apple would cover the phone’s antenna with a non-conductive coating.

Apple may also extend the period during which dissatisfied customers can return their iPhone—allowing it to later make the case that only a tiny fraction of users actually returned the iPhone, despite the media frenzy over this issue.

Whatever course of action the company winds up taking, it should become clear after Friday’s press conference. Be sure to join us at Macworld.com, as we bring you all the details along with Apple’s answers to these iPhone 4 questions.

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