Will iPhone 4 'Death Grip' Debacle Tarnish Apple's Image?

"Upon investigation, we were stunned to find that the formula we use to calculate how many bars of signal strength to display is totally wrong. Our formula, in many instances, mistakenly displays 2 more bars than it should for a given signal strength," the company said. Apple said it would release a free software update soon to fix the problem.

Apple Will Likely Not Announce Recall Friday, Analysts Say

Cult of Mac's Kahney said he thinks that while it would be expensive, some kind of "soft recall" could adequately address the issue.

"I think that if they say that there's a problem here and we have a good hardware solution, they'll be fine," he said. "I think that's what they've got to do, otherwise this problem won't go away,"

He suggested that the company fix the phone with a coating over the antenna and then let current iPhone 4 customers swap phones if they are experiencing reception problems.

Others emphasize that the company will likely stay away from a recall altogether.

"For them to recall at this point is going to cost tons of money and hurt their brand image even more," said Kevin Tofel, editor of the mobile technology blog JKOnTheRun.

Though he said that though the company was on "unprecedented ground," Tovel said he believes the situation will only be a blip on the radar in the long run, assuming Apple comes up with a solution.

"They can't not do anything anymore. They've lost control of the situation. It's out of control from a PR standpoint," he said. "They've got to hand out free bumpers or figure out some kind of workaround."

Analyst: Apple Needs to Give Clarification, Re-Direct the Media

Tim Bajarin of Creative Strategies, Inc., a Silicon Valley analyst said that while not all of the phones appear to have the antenna issue, the problem still appears large enough that Apple needs to steer the media conversation.

"What I expect Apple to do is clear the air, give everybody a solid understanding of the technology and what they've done," he said. "And, fundamentally, if there is an issue, explain some kind of remedy."

He also said that given the fact that not everyone seems to be experiencing the antenna problem (he, for example, was unable to replicate the issue on seven phones), the company might want to explore the possibility that only a batch of phones were affected during manufacturing.

Still, others point out that despite complaints from customers, it doesn't appear that they're so upset that they're actually willing to give up the phone.

"We've all been talking about this but… are people lining up at stores to return the iPhone? I haven't seen it," said Lance Ulanoff, editor-in-chief ofPC Magazine. "The iPhone 4, in PC Magazine's opinion, is an excellent product, period."

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