iPhone 4G?

[Rico]

Public opinion is a VERY fickle beast.  Don't underestimate how fast people can turn on you or your company.

Consider the XBOX.  The system had and continues to have some serious design flaws.  This causes it to become basically inoperable - the classic, "red-ring" of death.  Of course, not being able to play video games isn't exactly dangerous and/or causes any damages.  But Microsoft basically continues to extend the warranty and fixes or replaces a TON of systems for free.  We've had three replaced I think now.  Two for one box and one for another.  The newer versions are more problem free, but Microsoft did the right thing and continues to fix or replace a design flaw with older systems.

[Bryancd]

Actually it's less fickle than you think, especially when it's considered aspirational and is universally adopted. Amazing as this is even to me, iPhones and now iPads are become to be seen as MUST HAVE items for back to school this year among both students and their parents. Again, this is simply what the research done is showing, I'm not editorializing, just relating what trends we are seeing.

And Apple is a much better run company than Microsoft, especially since Gates left and Balmer has been in charge. He's a moron and investors have fled their stock accordingly.

[QuadShot]

No worries.  I love a good debate.  But...do you really think that in today's world of "what can you do for me now" that if Apple screws the pooch on this and continues saying "You're holding the phone all wrong", THAT won't impact their customer loyalty on a grand scale? I'm pretty sure I'm not alone in feeling this way, but when Jobs made that statement, it was like he was telling us we're all idiots. "Hey STUPID! There's nothing wrong with my product, it's YOU! YOU! You just don't know how to use a hyper advanced piece of technology". Don't get me wrong, I love Apple and I AM one of their biggest supporters, but let me tell you, even if someone I love lies to me repeatedly and repeatedly takes advantage of me, I'm going to kick them out of my life.  Same with brands.  If Apple doesn't take this issue seriously and FIX IT, they will lose me. And you may think, so what? They can afford to lose a few thousand customers, but Apple better NOT think that way. That, in my opion, is the Wal-Mart mentality. For every one upset customer, there's 20 behind them in line waiting to buy. That's a crap attitiude. But...perhaps I'm showing my age again. I actually believe that a company should have some loyalty to their customer base. Not just the millions but the one. Losing ONE customer should impact the way the act just the same as losing 1,000...

And no worries brother, I'll debate with you, or anyone, but I will NEVER have any ill feelings toward ya! :)

[billybob476]

Good article on GigaOM:

The timing of the press conference reflects the fact that the company is hosting its earnings call on Tuesday and it makes sense for it to deal with the antenna issue prior to that call. In a note to his clients this morning, Rodman & Renshaw analyst Ashok Kumar wrote:

Our supply chain checks reveal that Apple has instituted a design fix for the iPhone 4 that more adequately insulates the transceiver module. Apple is also likely to offer the bumper, gratis, as an intermediary solution. It is unclear if Apple will announce an official recall.

http://gigaom.com/2010/07/15/iphone-recall/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+OmMalik+(GigaOM)

[Bryancd]

Good article on GigaOM:

The timing of the press conference reflects the fact that the company is hosting its earnings call on Tuesday and it makes sense for it to deal with the antenna issue prior to that call. In a note to his clients this morning, Rodman & Renshaw analyst Ashok Kumar wrote:

Our supply chain checks reveal that Apple has instituted a design fix for the iPhone 4 that more adequately insulates the transceiver module. Apple is also likely to offer the bumper, gratis, as an intermediary solution. It is unclear if Apple will announce an official recall.

http://gigaom.com/2010/07/15/iphone-recall/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+OmMalik+(GigaOM)

Yep, that's about where the wall street consensus's is in regards to what's going to happen.

And Al, there's no chance Apple doesn't address this issue fully. They won't string people along for months, it doesn't make good economic sense. I agree that repeated issues can be very damaging, but that's really not what's happening here. The phone has been out for a few weeks, the problem has been identified, and a resolution is forth coming. I realize that in the internet age, blogs and forums and the like can spread news so fast that it's tough to separate fact from fiction. I think you would have to agree thatalthough you may be dissatisfied at the company's initial response, they are clearly working in good faith for a resolution and to characterize it as anything else is a bit extreme at this point.

[Rico]

Bryan - I have two sons.  Both at college.  One still in college, one working on campus and heading to grad school.  Neither has an iPad or iPhone.  Most of their friends also have neither, and most really don't like the iPad for many reasons (typically because it can't do a lot of things they need it to do).  Just from my little corner of the world.  Be careful what "reports" you read.

Oh, Droid X - on sale today!  ;)

[Bryancd]

Bryan - I have two sons.  Both at college.  One still in college, one working on campus and heading to grad school.  Neither has an iPad or iPhone.  Most of their friends also have neither, and most really don't like the iPad for many reasons (typically because it can't do a lot of things they need it to do).  Just from my little corner of the world.  Be careful what "reports" you read.

Oh, Droid X - on sale today!  ;)

Actually, I have to be careful of the N=1 kind of analysis. Paid research analysis usually is pretty accurate. It's anecdotal and internet chatter I have to avoid.

[KingIsaacLinksr]

Bryan - I have two sons.  Both at college.  One still in college, one working on campus and heading to grad school.  Neither has an iPad or iPhone.  Most of their friends also have neither, and most really don't like the iPad for many reasons (typically because it can't do a lot of things they need it to do).  Just from my little corner of the world.  Be careful what "reports" you read.

Oh, Droid X - on sale today!  ;)

I'd have more confidence in the Droid X if motorola had not made this phone.  Since they did, I auto-ignore the capabilities of the phone.  Sorry, too many times I've been screwed by that company in some form.  

It's also ironic you bring up Microsoft earlier.  They have been making bad software and hardware for the past 5 years and still easily get away with it.  Why?  Because everyone is dependent upon them.  So they can make mediocre software, and get away with it.  Because there are few alternatives.  Why is this ironic?  Because Apple screws up one feature on a brand new smartphone and everyone sues their ass for it.  Why don't we do the same to Microsoft.  We should sue them for the horrible experience that was Vista.  We should then sue them again for making 7 nothing more than a glorified update of Vista.  We should also sue them for the red ring of death on the Xbox.   See how ridiculous this is getting?

Seriously, there should be no grounds to sue Apple.  Don't like the phone?  Move onto the Droid.  I hear they have cookies :P  

King

[QuadShot]

Bryan - I have two sons.  Both at college.  One still in college, one working on campus and heading to grad school.  Neither has an iPad or iPhone.  Most of their friends also have neither, and most really don't like the iPad for many reasons (typically because it can't do a lot of things they need it to do).  Just from my little corner of the world.  Be careful what "reports" you read.

Oh, Droid X - on sale today!  ;)

I'd have more confidence in the Droid X if motorola had not made this phone.  Since they did, I auto-ignore the capabilities of the phone.  Sorry, too many times I've been screwed by that company in some form. 

It's also ironic you bring up Microsoft earlier.  They have been making bad software and hardware for the past 5 years and still easily get away with it.  Why?  Because everyone is dependent upon them.  So they can make mediocre software, and get away with it.  Because there are few alternatives.  Why is this ironic?  Because Apple screws up one feature on a brand new smartphone and everyone sues their ass for it.  Why don't we do the same to Microsoft.  We should sue them for the horrible experience that was Vista.  We should then sue them again for making 7 nothing more than a glorified update of Vista.  We should also sue them for the red ring of death on the Xbox.   See how ridiculous this is getting?

Seriously, there should be no grounds to sue Apple.  Don't like the phone?  Move onto the Droid.  I hear they have cookies :P 

King

King...well, because we EXPECT that performance out of Microsoft! :) I agree with the lawsuits being stupid, I really do. That's why I won't participate.  Our society has become way too litigious and it takes precious legal time away from the things that are necessary. However, whenever you have people, you'll have a subset of bottom dwelling lawyer types looking to profit off of them.
And Bryan, I'm sure you're right.  Apple will make good on this.  I'm just a bit bitter because I was dumb enough to stand in line for 4 1/2 hours and pay $300 to extend my contract with ATT! YIKES! My fault.

[Bryancd]

I don't think you will regret that at the end of the day here, Al.

Here's the bottom line. The iPhone platform and the 4G iPhone is the most popular smartphone/potrtable internet device on the market in terms of growth and consumer perception. They have made a poor design choice with the antenae which is causing recpetion issue's. They will fix that error in future models and will look to provide a remedy for those 3+ million phones already sold. You will likely have repurchased the phone and will be enjoying all of it's capabilities you wrote about initially when yopu bought it. You're not going to buy a Droid or a Palm, or a Blackberry. That's a basic, sober view of where we are today on this.

[QuadShot]

Here's a twist: I have a co-worker who purchased the iPhone 4 last week.  He used to be on the Singular network, which I guess now it part of ATT.  He never had issues with his Singular reception, and hasn't had any of the issues most of us are facing now. AND, he lives way out in East Gilbert, which is pretty much the middle of nowhere. He has full signal strength and hasn't dropped a single call.  Possible he's on a different network? Strange stuff here...

[Bryancd]

Here's a great review of some of the best analysts views on what might happen tomorrow and going forward:

"Apple's scheduling of a press conference Friday to talk about the iPhone 4 could foreshadow a product recall, a free in-store modification of the device's hardware, or a handout of free bumpers, depending on who you ask.

A number of Wall Street's most prominent analysts chimed in on Thursday to share what they think Apple will say at its iPhone 4 press conference, scheduled for 10 a.m. Pacific Time on Friday at its Cupertino, Calif., campus. Some see the scheduling of the press conference as evidence that Apple could initiate a recall of its recently launched handset, while others still believe that a full recall is a long shot.

RBC Capital Markets

Analyst Mike Abramsky noted that the iPhone 4 now has an availability of 3 weeks, up from a shipping time of 7 to 10 days from a few days ago, which could imply a transition in production.

"While some have suggested Apple could provide cases or bumpers, in our view Apple may prefer to more permanently resolve the perceived issue, to avoid ongoing impacts to reputation and brand," Abramsky wrote.

If Apple does institute a recall, it would likely impact the timing of the international launch of the iPhone 4, he said, which is planned to debut in 18 additional countries by the end of July, and a total of 88 by the end of September. He sees a recall costing Apple $1.8 billion in revenue and 40 percent earnings per share in its fourth-quarter guidance.

"We believe Apple will do whatever is necessary to correct the perceived iPhone 4 reception problem," he said. "While the fix may come at some cost, Apple with its $42B cash and $16B/yr cashflow can easily afford it. Apple customer loyalty is deep and resilient, and in our view, we expect iPhone 4 demand to rebound quickly. What could change our view is if Apple is perceived as handling the issue badly, the issue is protracted, or sales/financial impact worse than expected."

Piper Jaffray

Analyst Gene Munster with Piper Jaffray still maintains that a recall is unlikely, but he does believe that a hardware modification is more realistic given the fact that Apple is now holding a formal event.

"It is increasingly likely that the company will make an investment in the brand and calm the PR storm by offering current iPhone owners an in-store fix free of charge," he wrote. "Specifically, we now believe there is a 50% chance the company offers a free modification to current iPhone owners and includes the modification on all future iPhone 4s."

The change would likely result in a disruption of iPhone 4 sales for one month in the September quarter, he said, as the company would need to modify and re-stock phones before it sold them. Munster had previously forecast Apple to sell 9.5 million phones in the September quarter, but he believes those numbers would take a 12 percent hit in the event of a hardware modification.

A full recall, Munster believes, would cost Apple $1 billion in a one-time charge. He believes replacing every iPhone previously sold would present an average cost of $250 per handset to the company.

Munster also sees a 40 percent chance that Apple gives away bumper cases that resolve the reception issue. The rubber cases retail for $29. He said there is a 10 percent chance that Apple will explain the issue and do nothing.

"Despite these issues, consumers love the iPhone 4," he wrote. "Ultimately we believe Apple will manage these issues in a consumer-friendly way and maintain its pristine brand."

UBS

Maynard Um also believes a recall is unlikely to be announced by Apple on Friday. Such an approach, the UBS analyst said, would result in the immediate halt of iPhone 4 sales by Apple and its carrier partners.

He said if the solution presented by Apple is straight-forward, some may wonder why Apple didn't just choose to announce it through a press release. Given the considerable media attention the issue has received, Um said that just isn't an option for Apple.

"We believe an event is necessary as a press release to address what has become a 'loud' issue would likely have drawn more ire," he said.

Um sees the toll the news has taken on Apple's stock as a buying opportunity for investors. UBS has a $320 price target set for AAPL stock."

[billybob476]

I can corroborate this. We don't have the iPhone 4 here in Canada as of yet. The grapevine was saying it was supposed to be out by the end of this month. I haven't heard a peep out of my provider regarding a launch date for the device in Canada. The only email I received from them advised customers to stop placing calls to customer service asking about the iPhone as the CSR's had no additional info.

You'd think that if the phone were coming out here in the next 2 weeks we'd have heard something by now. There is definitely a delay and while we can't be sure I do imagine it is related to the current situation.

[Bryancd]

Wall Street Journal is also reporting that there won't be a recall, so it's likely in store repair and bumpers. Yes, G4 launches in Europe and Asia will also be delayed until September to get the fix into the new phones.

[Feathers]

I've seen at least one rumour of a design change to address the issue but that had no word as to whether it could be retro-fitted to existing phones.