Fears grow on iPhone recall

A poor review for its iPhone 4 from an influential consumer guide underpinned mounting complaints about the hot-selling device's reception and spurred speculation about a product recall.

Consumer Reports said on Monday it could not recommend the iPhone 4 - which sold 1.7 million units worldwide in its first three days - after its tests confirmed concerns about signal loss when the device is held in a certain way.

That report spurred widespread discussion on Tuesday, including on popular tech site Cnet and multiple blogs, about the possibility of an iPhone 4 recall: an unheard-of event for a company lauded by investors and tech aficionados for its marketing savvy and product quality.

Apple, which has called the iPhone 4's June debut its most successful product launch ever, has not responded to the widely watched nonprofit organization's report or to the recall talk.

The company has said all mobile phones suffer some signal loss when cradled in different ways, and suggested that a software glitch might have misled users by overstating signal strength.

Analysts said Apple needs to take quick action to avert any lasting damage to its reputation for quality products - an image honed by iconic gadgets such as the iPod and iPad - though they did not see sales being hurt for now.

"They need to provide an actual fix - not a bumper fix - so that the product performs as it should," said Ashok Kumar at Rodman & Renshaw. "Apple should have taken a higher road when addressing the design flaw, instead of taking the hard-line stance that they did."

"This is not a Toyota problem, but it is a problem that Apple needs to address head-on," he said, referring to the Japanese automaker's global recalls of more than 10 million vehicles since late last year.

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