In a concession to the growing controversy surrounding the iPhone 4 reception issue, Apple Inc. (AAPL) CEO Steve Jobs on Friday said his company “is not perfect” and it will give a “free case” to everyone who bought the iPhone 4, as well as full refunds to the “small amount of customers” still experiencing problems.
Even though Jobs rigorously defended the iPhone 4’s performance, he said Apple wanted to make the issue right by its customers. The offer for a free case extends to Sept. 30 and since Apple can’t make enough cases, it will offer customers a free case from other sources. “And, if you’re still not happy even after getting a case, you can bring your iPhone 4 back undamaged for a full refund,” Jobs said. “We are going to take care of everyone. We want every user to be happy — and if we can’t make ‘em happy, we’ll give them a full refund.”
During his presentation, Jobs defended the iPhone 4’s performance, saying other phones had similar reception issues and only a fraction of customers have returned the iPhone 4 due to any antenna woes. Jobs did admit, however, that the iPhone 4 has dropped more calls than the iPhone 3Gs.
“We knew that if you gripped it [the iPhone 4] in a certain way the bars would go down a little — just like every smartphone,” Jobs said during the press conference, according to a live blog from gdgt. “It’s a challenge to the entire industry, and we’re hoping to make some contributions to this in the coming years.”
He said Apple has sold more than 3 million iPhone 4’s in the first three weeks of its availability. But only a fraction of those customers have complained about the antenna issue, saying “one half of one percent” have written Apple about the problem, and only “1.7 percent” of customers have returned the phone.
“It doesn’t seem like a good idea if you touch your phone in a certain way and the bars go down,” Jobs said. “But one of the first things we learned: it’s certainly not unique to the iPhone.” During his presentation, and before announcing his solution, Jobs said holding other smartphones can result in signal degradation, using models from HTC (2498.TW), Samsung (005930.KS) and BlackBerry (RIM) as examples.
“You know exactly where to [not] hold it,” Jobs said of the iPhone 4. “We screwed up on our algorithm.”
Jobs said Apple has spent “over $100 million in our antenna testing facilities over the last five years, and we have 18 Ph.D scientists and engineers doing some very advanced antenna design.”
Jobs acknowledged that the antenna issue was a PR challenge for the company, but making things right for its customers “drives us. When we have problems like this and people criticize us, we take it really personally,” he said “Maybe we should have a wall of PR people to insulate us, but we don’t — when our users have a problem, we have a problem.”
The faulty antenna has plagued the iPhone 4 since it was released in late June. Bloggers almost immediately reported signal degradation when a finger or palm covered the antenna slot on the bottom of the phone. Then Monday, Consumer Reports added considerable fuel to the smoldering issue, as it said it could not recommend the iPhone 4 until Apple fixed the reception issue.
Shortly after the issue first surfaced, Apple first told users how to hold the iPhone 4 and then blamed a software glitch. Neither approach mollified customers; indeed it led to much criticism for Apple. On Tuesday, the growing controversy lead to a $5 billion drop in Apple’s overall market value.
