Analyst: iPhone 4 recall would cost Apple US$1.5 billion

iphone 4 cases“In the wake of Consumer Reports announcing that it would not be recommending the iPhone 4 due to the much-discussed antenna problems, there have been calls for Apple to recall the device,” Erica Ogg reports for CNET.

MacDailyNews Take: Who exactly is calling for Apple to recall the device?

Ogg continues, “While a recall could be damaging to Apple’s reputation, it would also be a costly endeavor, according to some calculations made by Bernstein Research analyst Toni Sacconaghi. In a research note on Tuesday, Sacconaghi estimated that while ‘a full product recall of the iPhone 4 (is) highly unlikely,’ it would cost Apple $1.5 billion, or 3.5 percent of its total cash on hand.”

“What would be more likely–and cheaper–is that Apple could issue a free rubber bumper case with each phone,” Ogg reports. “That would prevent a person’s hand from coming into contact with the phone’s antenna, which is built into its exterior metal strip. Although Apple charges $29 at retail for the rubber cases, Bernstein estimates that giving them away to iPhone 4 customers would cost the company $1 per unit.”

Full article here.

MacDailyNews Take: Drive down the price of AAPL shortly before earnings are reported by whatever means necessary, so that when it pops, you rake in a tidy profit. Rinse, lather, repeat; four times per year, at least. It’s just like stealing, but without the jail time.


  1. Oh boy… Apple better stop selling more and more and more iPhone 4’s, or it will soon be costing them all the cash they have in the bank to do a recall. LOL. Inept journalism at its worst.

    Until late last week, every REAL iPhone 4 customer could have returned their iPhone 4 for a FULL refund because even those that lined up to get one on DAY ONE were still within the two-week window; and Apple even (temporarily) waived the restocking fee.

    There have been no lines at Apple Stores with irate customers waiting to get a refund (or at least asking for Genius Bar help). If even 10% of 2-3 million REAL iPhone 4 customers were having REAL problems with “reception,” it would be quite obvious and the moronic media would be all over it. Even 1% would be at least 20,000 and it would be obvious. Heck, even “a few hundred reports” is usually enough for the media and bloggers to go melodramatic and declare “mega-disaster.”

    So I can’t imagine who would be asking for a recall. Can’t be the actual iPhone 4 customers, since that would mean relinquishing their prized possession, which is obviously meeting or exceeding their expectations.

  2. @ken1w — Nicely said. There must be all of a few dozen blogger-whiners. Far more people saying they have no problem, or putting videos on YouTube showing other phones that have similar behaviour. MOVE YOUR FINGER HALF AN INCH! Or take the phone back. But stop whining. Obviously, the vast, vast majority of people are happy with their phones.

  3. A recal is absurd. If this really is a hardware problem there is nothig Apple can do. The phone is built in one way, it can’t just be changed.

    But I think that the software update will resolve this and make all the Apple haters and Google Linux Talibans to shut up.

  4. 2 weeks to return your phone.
    Very few people return the phone.
    Only a few people have reception issues.
    A recall?

    Even Microsh*t didnt recall the xbox and nearly ALL of them have fu**ed up.

    Apple sure do get people going, dont they?!

  5. I have a suggestion. Why doesn’t Apple hire all these geniuses who seem to know everything about what Apple’s doing wrong, and how they could fix it?

    Let them run the company with humility, as opposed to the arrogance Apple’s known for. Let em open up all Apple’s SUPPORT forums for unproductive criticism. Let them offer free bumpers with every iPhone in hope that they’d shut up. Treat the customers with the “respect” they deserve by making a public statement admitting that the iPhone 4 has a built-in fault that’s likely to remain until the iPhone 5 is released. And finally, when in doubt, recall the products!

    Yeah, let’s see where that gets Apple. Who needs experience as a source of knowledge when you have the collective minds of the community telling them what to do.

  6. Exerpiencing the EXACT same problem with or without the bumber. So it doesn’t help having it on! With all the tests I have never seen anyone do the test with the bumber on! Maybe someone should before they say that it fixes the problem! I don’t know, just an idea!!!

  7. I have a 3GS and no connection issues what-so-ever!

    Guess im lucky I didnt Upgrade! 😀

    Think I will wait until version 2 of the iPhone 4 comes out and they sort out this HARDWARE FAULT before I get one!

    Sometimes not being an early adopter is the best option.


  8. I’m a clown. What do you think?

    Don’t get me wrong. I’m all for criticism, just so long as people keep in mind that this isn’t a game. Or rather, a much, much more complex game than people treat it to be, where every tiny decision can affect the future of the company.

    It’s like a game of chess, where a novice player loses the game because he didn’t consider the consequences of capturing that undefended rook.

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