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.

49 Comments

  1. When you think of all the crap that has been foisted upon the unsuspecting electronics buying public, Apple selling a modern, state of the art smartphone with an external antenna is not a problem whatsoever.

    All external antennas can be shorted out. That’s the nature of the beast. External antennas work better than internal antennas. With AT&T you need all the help you can get.

    So, the simple solution is return the iPhone if you don’t like it and get your money back, or, stop holding it that way and enjoy the iPhone you do like.

    No need for a recall. Besides, Apple could use some returned iPhone 4s to help with the demand that is still outpacing production.

  2. the real problem is a simple miscalculation by apple of measurment of signal by displaying signal bars, thus tricking the device into thinking it has no signal. Apple has looked into this and found the problem, AT&T;has already given them the correct calculation for measurment but apple has not distributed it.
    sources- Apple

  3. the real problem is a simple miscalculation by apple of measurment of signal by displaying signal bars, thus tricking the device into thinking it has no signal. Apple has looked into this and found the problem, AT&T;has already given them the correct calculation for measurment but apple has not distributed it. even with the rubber bumper case, the rubber would still be “touching” the antenna ALL THE WAY AROUND THE DEVICE!
    sources- Apple

  4. We have had a few iPhone 4s with frog cases working flawlessly in many places but dropping calls and having poor voice reception in specific areas and neighborhoods of greater NYC. This can be predictably duplicated with the faulty reception reoccurring only in certain areas.

    ATT admits in conversation with us, that it is definitely “an ATT SERVICE ISSUE”…

    I wouldn’t be surprised if their new upgraded equipment is faulty and because of it’s recent implementation that coincides with the release of iPhone 4 it is leading to false iPhone antenna conclusions.

  5. 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.

  6. @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.

  7. 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.

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