Apple Will Not Recall iPhone 4

Steve Jobs, the CEO of Apple, announced today that the company will not recall the iPhone 4 over antenna issues as many had speculated. Instead, they will offer a free case to anyone who has bought the new iPhone in order to help minimize the problem.

Starting next week, you can apply on Apple’s website for a free case. If you have already bought one, Apple will refund what you paid for it. Alternatively, users have the option to return their phones within 30 days as long as they are undamaged, although as we’ve noted before, this option has always been on the table.

This announcement came during a press conference at Apple’s (Stock Quote: AAPL) headquarters in Cupertino, Calif., that dragged on for well over an hour. Jobs sought to play down the mounting concerns about the newest iPhone, a public relations crisis he referred to as “antennagate.” According to Jobs, all smart phones lose reception when people hold them near the antennae that wraps around the outside of the phone.

“This is life in the smartphone world. Phones aren't perfect. It's a challenge for the whole industry. Every phone has weak spots,” Jobs said according to a transcript of the conference by Engadget.  To support this point, Jobs methodically showed how several smartphones, including a Droid and Blackberry, lose reception when held the wrong way.

Jobs argued that the media’s attention on this issue has been overblown. Since the iPhone 4 was released three weeks ago, it has sold an astounding 3 million copies, and in that time, Jobs claims that just 0.55% of all iPhone 4 owners have reported a reception problem with their device. However, as Business Insider points out, that still means 17,000 people have been frustrated enough to call the company.

In the last few weeks, many users have complained that the reception drops significantly when they hold the phone in certain spots. Apple initially blamed customers for holding the phone the wrong way, but later admitted that there may be a software problem which causes the signal bars to drop. Other publications like Consumer Reports went one step farther and argued that there may be a fundamental design flaw with the hardware.

Jobs stated repeatedly that Apple’s engineers are working hard to figure out just what the cause of the problem is and if there is a way to fix it. But that didn’t stop him from offering a guess as to what the real problem is with the iPhone 4. According to Jobs, the amount of calls dropped on the new iPhone is nearly identical to that of the old iPhone, but the big difference, as he sees it, is that fewer people have cases for the iPhone 4 than do for the iPhone 3G.

"When the 3GS came out, we didn't change the design from the 3G. So there were already lots of cases out there for the phone. And more than 80% of new buyers left the store with a case,” he said, according to Engadget. “Now the new phone doesn't fit those cases, and we can't make these bumpers fast enough, so only 20% leave the store with a case.”

Apple’s offer to provide every iPhone 4 owner with a case will apply for all phones bought until September 30 of this year. There is no word yet on what will happen after that date. For the time being, Jobs stressed that they will continue to work on the problem, “We'll continue to work on antennas that don't have this problem. But I think we're where the rest of industry is right now,” he said.

In other news, Jobs did take this opportunity to announce that Apple will start selling the white version of the iPhone 4 later this month. Although obviously, it doesn’t matter what color the phone is since you really have no choice but to cover it in a case anyway.

This isn’t the first time that Apple has hit rocky waters. Check out our roundup of Apple’s biggest failures over the years.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

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