iPhone Connection Forecast: Spotty

Apple's iPhone 3G is a marvel of design and ease of use, but not everyone is thrilled with the smartphone's 3G capabilities.

Blogosphere complaints about bad connections for the popular iPhone 3G crystallized on Tuesday in a report from securities analyst Richard Windsor, of Nomura Securities, who writes that "Complaints regarding the reception of the 3G signal are beginning to surface and some users are having trouble getting a 3G connection and hanging onto it.

The problems, which have cropped up on iPhone blogs as well as forums on Apple's Web site, include "high incidence of dropped calls, switching onto [the slower AT&T] EDGE [network] while the device is stationary and loss of reception while in good coverage," Windsor adds.

Poor connections have been reported in countries outside the United States, indicating that the problem lies in the device or the software, and not with AT&T's 3G network.

Since its release 30 days ago, the 3G version of the iPhone has sold up to 3 million units, according to analyst Michael Cote. Last week research firm Gartner released a report saying that the iPhone meets the minimum requirements for use on a corporate network, but companies deploying the device should take several steps to prepare it for business use. Problems with the high-speed connection will not encourage enterprises to adopt or support the popular consumer handset.

The problems represent an opening for Apple rivals Research In Motion, maker of the BlackBerry, and Nokia, says Windsor: "Apple has the industry-leading user interface and experience, but with an unreliable radio, these advantages will quickly be reduced to nothing."

InformationWeek has published a report that highlights how companies are using smartphones, PDAs, and pocket PCs to access business applications. The report can be downloaded here (registration required).

AT&T is the exclusive carrier for the iPhone in the United States. On its release in June 2007, the iPhone ran only on AT&T's EDGE network, with download speeds significantly slower than 3G connections. The release of the 3G version of the device has been the cause of another bout of iPhone-mania, convincing many skeptical users to convert from earlier models.

The new iPhone also includes several features critical to IT departments, including remote management, beefed-up security, and support for Microsoft's Exchange e-mail server.

AT&T spokesman Mark Siegel said that while "overall the iPhone is performing great on our 3G network," as with any mobile device reception can vary according to terrain, proximity to buildings, the number of people on the network, and so on. He also urged iPhone owners to sync frequently with iTunes to insure they have the latest software updates for the device. "That's the mark of genius of the 3G iPhone -- it's so easy to update," Siegel added.

Nomura's Windsor speculates that the problem lies in the Infineon chipset used to build the new iPhone. Infineon didn't respond to a request for comment.