Schwarz: Investment ramifications of iPhone 4 reception issue, esp. regarding Consumer Reports

iphone 4 cases“Highly respected Consumer Reports announced that it can not recommend iPhone 4 because of the reception weakness caused when the phone is held in the lower left corner,” jason Schwarz writes for Seeking Alpha.

MacDailyNews Take: “Highly respected” by grandma when she’s in the market for a new toaster, that is. Consumer Reports sucks at reviewing and quantifying computers and electronic devices. When they do get it right and miraculously choose the right computer or smartphone, it seems to be by sheer dumb luck, not by any design.

Schwarz continues, “Consumer Reports mentions that this is unique to the iPhone 4 model compared to past iPhone’s and it is also unique to the AT&T network as no other phones suffer from like reception issues. If the market was at a high this kind of news would cause AAPL to sell off $10. But because the market is near the low end of its trading range the stock is able to overcome the negative news. A market wide focus on low valuation is helping AAPL on a day like today.”

Schwarz has four thoughts on the matter:

1. This is nothing new… Consumer Reports is merely releasing an independent analysis that is hitting Wall Street today.
2. Nobody is in a hurry to return the phone. Apple users are confident that the problem will be fixed.
3. The Apple model of dealing with problems is that they don’t tell us anything until it is resolved.
4. These reception issues are not affecting sales. iPhone 4 is sold out everywhere.

Full article here.

[Thanks to MacDailyNews Reader “Arline M.” for the heads up.]


  1. Whenever you release new hardware with a significant upgrade to the software, you should expect issues. Apple’s no different than any than software company. I’d expect the problems to go away when the update comes out. My phone has worked well in both the San Francisco Bay and in Cabo San Lucas, Mexico. I still get dropped calls from time to time. I look forward for Verizon to balance the load.

  2. Buy a case to protect the edge of the iPhone 4 and you can’t touch the shiny metal (with your wet conductive hands). People really need to get grip on this. Get a cover and enjoy the world’s best smart phone or buy 1 get 1 free of those want-to-be RIMM berry phones.

  3. If it doesn’t affect the signal too much, their best bet is to disable the bottom section of the antenna when the signal starts to attenuate, or just disable it entirely. This would mean a design change / hardware fix, and a possible recall for people who want it. Before I noticed this issue, I was going to get a case as soon as Incase has them available.

  4. Customer satisfaction results are based directly on reports by consumers and polls of consumers. Actual customers.

    Testing and rating products is done by Consumer Union itself.

    There is a major difference between the two. (Their hi-fi evaluations are just awful. They try to use a few parameters to determine overall quality. Does not work.)

  5. Let’s be fair: If Apple is really, genuinely experiencing a problem with one of its products then what is the harm in genuinely acknowledging it? I get that what we are in reality fighting here is the hordes of haters who have detected a chink in the king’s armor and are swarming in to take advantage of it, but bashing back at them seems somewhat beneath us (or should be). Why worry about them? Their words are nothing but petty and jealous blog attacks. Who gives a shit, seriously? I know Apple makes fantastic products, I know they back them up with outstanding and thorough support, and I know they have earned my respect and customer loyalty. That is all that matters. Clearly they are experiencing an issue with this, but they will fix it. Clearly the antiMac crowd has jumped on it, but that ammo will soon be removed from their arsenal. Do you think Martin Scorcese goes out of his way to start pissing all over any film critic that doesn’t get his latest film? No. Why? Because who gives a shit what they think?! I just get a little bit worried about the pedestal (no matter how much they’ve earned it to date) that we automatically place Steve and Co. on. The fall is going to be HUGE when and IF the ever fail. And believe me, EVERY company fails eventually. Until then, again, who gives a shit what they say…

  6. My parents used to subscribe to consumer reports. Every time they reviewed cars, they would recommend some Chrysler or the Ford Tempo.

    I went for the BMW anyway.

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