Consumer Reports: Don't Buy iPhone 4

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Apple (Nasdaq: AAPL  ) suffered a black eye yesterday, when Consumer Reports (CR) all but accused the company of lying. The venerable magazine said it could not recommend iPhone 4 until the smartphone's antenna problem is fixed.

CR is one of the most widely respected, unbiased sources of consumer information on the planet, and its word carries a lot of weight. It bought three iPhone 4s from three different retailers and tested them in its "radio frequency (RF) isolation chamber." All three suffered a significant signal drop when the tester covered the small gap on the phone's left side with a finger or hand. Several other phones from AT&T (NYSE: T  ) were tested at the same time -- including the iPhone 3G S -- and did not exhibit the same problem.

"Our findings," says CR, "call into question the recent claim by Apple that the iPhone 4's signal-strength issues were largely an optical illusion caused by faulty software that 'mistakenly displays 2 more bars than it should for a given signal strength.'"         

"Call into question" is a nice way of putting it.

Now, I don't for one minute think this will make the slightest difference in Apple's smartphone skirmishes with Google (Nasdaq: GOOG  ) , Research In Motion (Nasdaq: RIMM  ) , and Nokia (NYSE: NOK  ) . There's enough pent-up demand for iPhone 4 that walking into a store and finding one remains a remarkable feat. Even Apple's online store still has a three-week wait for iPhone 4 deliveries!

But Apple is taking a credibility hit for this, and it's now under pressure to come up with a real solution for existing phones (beyond duct tape, which CR says actually solves the problem). A software fix would certainly be preferable, but I have no idea whether that's even possible for an issue of this type.

The rest of CR's review is tantalizing, naturally: The iPhone 4 finished atop the smartphone ratings, in part because it "sports the sharpest display and best video camera we've seen on any phone," has excellent battery life, and has an array of other new features. There's just that one pesky problem, however, and CR labels iPhone 4 "not recommended" until it's fixed.

I'm interested in your thoughts. If you've been waiting to buy an iPhone 4, will this make you delay your purchase until the issue is fixed? Or will you just buy one when you can, "mind the gap" as our London friends would say, and hope for the best when it comes to trusting Apple for a fix? Let me know in the comments box below.

Fool analyst Rex Moore drives on a parkway and parks on a driveway. He owns no companies mentioned in this article Nokia is a Motley Fool Inside Value pick. Google is a Motley Fool Rule Breakers recommendation. Apple is a Motley Fool Stock Advisor pick. The Fool owns shares of Google. The Motley Fool has a disclosure policy.

Read/Post Comments (15) | Recommend This Article (12)

Comments from our Foolish Readers

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  • Report this Comment On July 13, 2010, at 4:34 PM, lution wrote:

    Hmmm CR can't recommend Toyota cars or Apple iPhones in the same year. Who would have thought this would ever be possible a year or two ago. <tips hat to CR for staying unbaised>

  • Report this Comment On July 13, 2010, at 4:48 PM, mhoemann wrote:

    Thank you CR, for not falling into the odd frenzy of many other technology magazines and websites who, when presented with the *gasp* unthinkable, a flaw with an apple product, would just as soon push it under the rug so as not to harm their precious golden child.

    And SHAME on Apple for deleting posts about the Consumer Reports article on their forums. The little company that was so famous for it's Superbowl "1984" Anti-Orwellian ad has so far blocked anyone from using any service other than theirs to buy precious apps, any operating system and hardware other than their latest to develop said Apps, blocks other advertisers (google's AdMob) from showing their ads on the iPhone so that only apple can show them, pressures the police to raid the home of a -journalist- for property -their- engineer left laying in a public place, and blocks it's users from using flash, (a staple used prominently in hundreds of millions of websites), in order to push a not-ready-for-the-bigtime alternative that -they- happen to have a very vested interest in.

    Apple has very skillfully milked public love for their products, and I rode that stock wave, but they've also taken full advantage of their "can-do-no-wrong" reputation and used it to brazenly, openly leverage far more anti-competitive practices than what landed Microsoft in the Monopoly hot seat a few years back. I don't trust AAPL not to know when to quit... or to know when to back down... especially since they've gotten away with peeing on the rug so many time before.

  • Report this Comment On July 13, 2010, at 5:08 PM, JJMSpartan wrote:

    So what changed at CR?

    10 days ago, they said the antenna issue was much ado about nothing.

    Now they say that they can't recommend the iPhone.

    And the kicker - in the same report, they indicate it's their top rated phone.

    So does that mean that no one should buy any phone out there? If you shouldn't buy the best phone according to their testing, what the heck do you do?

    Apple isn't the only one with mud in their eye about this report...

  • Report this Comment On July 13, 2010, at 5:11 PM, JJMSpartan wrote:

    Also, I want to know which different retailers CR bought the 3 different iPhones from. For those of us on waiting lists to get one, this is important information as there might be a place we can buy one!

  • Report this Comment On July 13, 2010, at 5:15 PM, Brent2223 wrote:

    I personally appreciate Apple's Big Brother attitude around the iPhone. I'm a lifelong PC user, but have been sold on Apple products since I picked up a iPod touch a few years ago (and have since been through 2 iPhones). I'm not a computer engineer who needs to tear apart and tweak out my system - I just want something I can turn on and use. No viruses, no crashes, not compatability issues - the iPhone just works. To me, this is the future of computing. Desktops are dead.

  • Report this Comment On July 13, 2010, at 6:57 PM, PeyDaFool wrote:

    Consumer Reports has no bearing on my decision to buy an iPhone. Here's what I'm about to do:

    1. Buy a case (problem solved)

    2. Then buy some more shares of AAPL while I'm at it; this puppy is going to the moon...

  • Report this Comment On July 13, 2010, at 7:03 PM, Acesnyper wrote:

    As posted above, CR's jumped to both side of the coin about how they feel about the phone. Just seems unprofessional and frankly a bit of a let down review. How I feel about the product doesn't change.

    Shame to see CR drop the ball here.

  • Report this Comment On July 13, 2010, at 7:15 PM, Puckplayr4 wrote:

    Here is what Apple doesn't want to hear. I LOVE my Apple 3g-s, and I PLANNED on getting the iPhone 4 asap. But, a company that has ALMOST turned me into an "Apple Convert" totally (and not very cleverly) lied about the problem with the new phone, and is giving its customers the short end of the stick by not providing a free fix, (i.e. a cheap cover).

    Now I've gone from being a guy who was considering becoming "That Guy" who blindly pre-orders Apple's products to one that will now probably ALWAYS make sure it doesn't suck first. They are still batting .900, but this iPhone 4 is a swing and miss, even if everyone wearing a black turtle-neck thinks its a home-run.

    What's worse for Apple, my next computer purchase went from being "Probably my first Apple" to "Maybe my first Apple".

    I guess I'll return my new turtle-neck before I take it out of the package. (How many years until the next Hale-Bopp?)

  • Report this Comment On July 13, 2010, at 8:05 PM, sk8ertor wrote:

    Would someone please delete InfoThatHelp's posts? Better yet, please delete his entire account. He is absolutely lying about everything. Every time there's any article, he says ridiculous BS like RIM is bad and APPLE is god. He's an absolute liar about everything is not to be trusted.

    He says slap a case on it... are you kidding me? You're a fool! That's the stupidest thing I've ever heard. You HAVE to buy a case or your phone won't work. Ha! Ridiculous.

    And please give us your source about the return rante for the Tour. I have a very close contact with Verizon who tells me you are absolutely wrong. They sell the Tour and he told me that it was a very hot seller when it first came out almost a year ago and its return rates were like any other phone. It had a problem with the trackball but RIM replaced all of them free of charge.

    You don't see APPLE replacing any of these defective iPhones free of charge, do you? They tell people they're holding it wrong. And then they tell you that you should buy a case for it.

    InfoThatHelps probably owns APPL and shorts RIM. That's the only reason why he is always in EVERY one of these articles repeatedly talking up APPL and talking down RIM with LIES!!!

  • Report this Comment On July 13, 2010, at 8:09 PM, sk8ertor wrote:

    CR is absolutely true. People should not buy the defective iPhone 4. Apple needs to issue a total recall and admit the design flaw in this phone. Everyone needs to boycott Apple until they admit to their mistake. Stop being trolls and stop buying their product!!!

  • Report this Comment On July 13, 2010, at 8:11 PM, sk8ertor wrote:

    As mentioned by another user above, SHAME on Apple for deleting posts about the Consumer Reports article on their forums

  • Report this Comment On July 13, 2010, at 8:21 PM, hportofino19 wrote:

    I love Apple and was waiting for my current Sprint contract to expire to then sign up with ATT and get an Iphone 4. I never thought I'd say this.... But.....I'm getting a Sprint EVO now instead. Apple just lost $600 for two new iPhones......Mr.Jobs please wake up, you will bury your own company!!!!!!!

  • Report this Comment On July 13, 2010, at 11:03 PM, Superdrol wrote:

    I remember how they said Steve Jobs had a hormonal issue to having his liver replaced. I could see how those two issues could be confused.

    Innocent mistake no doubt.

  • Report this Comment On July 14, 2010, at 6:25 PM, mDuo13 wrote:

    Contrary to Acesnyper, I think it's very reasonable for CR to tell consumers not to buy an iPhone 4 or buy any other smartphone -- right now. And it's not because I'm a luddite. On the contrary --

    If the iPhone 4 really is the best smartphone out there, barring a crippling design flaw that will probably be fixed soon, then consumers have every reason to hold off a little bit until the antenna problems are resolved and the iPhone 4 is an unmarred buy.

  • Report this Comment On July 17, 2010, at 9:17 AM, imntacrook wrote:

    CR has lost a lot of credibility with this outrageous article. First, any phone will drop its signal strength if held a certain way. Second, I travel a lot, and except in certain mountainous regions, have never had a dropped call or not been able to access the web or make a phone call. The iPhone is in my humble opinion one of the finest quality consumer products EVER made. Bar none (excuse the pun)

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