Apple’s Bumper Solution

by Matt Gallagher

Red Herring Journalist

Figuring that most high-tech nuts won’t want to sport their new iPhone 4 wrapped up in duct-tape, Steve Jobs offered a more fashionable solution, though one that pretty much accomplishes the same thing. At a special press conference July 16, Jobs announced that Apple will provide free cases, either their own $29 Bumpers or one made by a third party chosen by the consumer. iPhone 4 users who have already purchased such products will be refunded for the case. The give-away lasts until Sept. 30, at which time Apple will consider a new strategy. Consumers also have the option to return their phone in 30 days for a full refund.

When Consumer Reports refused to recommend the iPhone 4 earlier this week because its lab tests confirmed that reception on the phone could be lost with a simple touch, recommending duct tape as a solution, the web has been in an uproar, wondering if a recall would be issued. Some users have posted demands for a recall; others jokingly predicted Apple would off free Bumper cases, but only in pink.

Experts blame the faulty signal on the phone’s redesigned antennae, built into the stainless steel band that rings the phone.

While a recall hasn’t been issued, the pink Bumper cases weren’t far off, though Jobs did not specify a color, nor did he specify that Apple nor the phone’s external antenna design was to blame for the problem. He continues to call the phone, “the best Apple has ever made,” but conceded that the lack of cases for the new iPhone may have contributed to complaints about its touchy reception. Jobs pointed out that only 20 percent of all iPhone 4 sales included cases, compared to the 80 percent of previous iPhone owners who bought cases.

Antennagate,” as Jobs coined the situation, “is not a unique problem to Apple.” He stated that the BlackBerry Bold 9700, the HTC Droid Eris and the Samsung Omnia II each had similar issues when they were first released.

The uproar over the sketchy signal “has been blown so out of proportion it’s incredible,” Jobs stated. Indeed, the situation has been the buzz of the Internet this week, with some bloggers comparing the PR blunder to that of BP. The problem has even made it to Congress. US Senator Charles Shumer, a Democrat from New York, wrote Jobs a public letter, calling Apple’s handling of the matter “insufficient,” challenging the company to address the issue “in a more straightforward manner.”

Still, 3 million iPhone 4s have been sold, and with less than one percent of consumers calling to complain and only 1.7 percent returning their phones, problems are relative. In fact, the new phone only drops one of out 100 additional calls than its predecessor, iPhone 3GS. What seems to be the biggest uproar is Apple’s handling of the problem. Bloomberg reported earlier this week that Jobs knew about the issue before the phone was released, alleging that management was been told about it by Apple’s antenna expert Ruben Caballero. Though Jobs described the story as “a crock,” Apple had suggested that as early as last month users simply buy a case or avoid touching the lower left corner, indicating they likely knew something was up.

So they’ll just give the cases away instead. It’s a lot cheaper than recalling every iPhone, a product that makes up 40 percent of Apple’s revenue.

Apple’s stock has taken a hit over the matter. The company’s shares have gone down 7.8 percent since June 23, a day before the iPhone 4 hit the market, despite record sales. Like the iPhone 4, markets can be touchy.

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