Facing heat from customers, the media and Wall Street analysts over iPhone 4 antenna and reception problems, Apple CEO Steve Jobs today said every iPhone owner would be given a free case.
The announcement came at a hurriedly-called news conference at Apple's Cupertino, Calif. campus. The event was announced late Wednesday, and came amid a three-week span of negative publicity surrounding the iPhone 4 that reached a crescendo Monday when Consumer Reports said it could not recommend the smartphone because it dropped calls and lost signals when users held it in certain ways.
"We love our users, we really love them," Jobs said during the news conference. "We try very hard to surprise and delight them. We work our asses off. When we fall short, which we do sometimes, we try harder. We pick ourselves up, figure out what's wrong and we try harder."
Customers who have already purchased a $29 Bumper case from Apple will receive a refund, Jobs said, and all iPhone owners will be given a choice of several different manufacturers' cases, including Apple's. "We can't make enough bumpers," Jobs said. "No way can we make enough in the quarter. So what we're going to do is source some cases and give you a choice."
The free-case-giveaway is effective immediately, and good for iPhone 4 purchases through Sept. 30. iPhone 4 owners who have bought a Bumper will be able to apply for a refund on the company's Web site next week.
The free case move was expected by most analysts and crisis public relations experts, who had urged Apple to publicly address the issue, and take that as the easiest route to a fix.
After its Monday no-recommendation announcement, Consumer Reports ran additional tests that showed an Apple-sold Bumper case solved the iPhone 4's reception woes.
Complaints about the iPhone 4's reception surfaced within hours of its June debut, as buyers griped that touching the external antenna -- embedded in a steel band that encircles the case -- often dropped calls or caused the signal strength indicator to plummet. Apple quickly acknowledged that holding the iPhone 4 could weaken the signal, but told consumers to hold their phones differently, or buy a case.
A week later, the company claimed that the iPhone 4's signal formula was flawed and promised to update the software.
Before Jobs announced the case giveaway and Bumper refunds, he spent much of his time on stage defending the iPhone 4 -- claiming that all phones have a similar antenna and reception problem -- and touting its sales, which have reached three million units since its June 24 launch.
"We're not perfect. We know that and you know that," said Jobs. "And phones aren't perfect, either."
Jobs argued that other smartphones have similar reception issues, and showed how BlackBerry, HTC and Samsung phones also lost signal strength when held. "All smartphones have weak spots, this is not unique to the iPhone 4," he claimed.
Jobs also said the iPhone 4 is now more accurately reporting true signal strengths, unlike rivals. "We had incorrect bars&, we screwed up on our algorithm," he said. "Some of these other phones might be being a little more liberal with their algorithms, too."
Apple released the iOS 4.01 update Thursday for the iPhone that included a corrected signal indicator algorithm.
Jobs downplayed the impact of the widely-publicized iPhone 4 problems, and took shots at the media along the way. "If you've read all these articles, you'd think it must be, jeeze, at least half of those people are returning their phones," Jobs said. "This has been so blown out of proportion that it's&it's incredible."
To prove his point, Jobs cited data from Apple's own support line and AT&T's logs. Only 0.55% of iPhone 4 owners have called AppleCare to complain about the antenna problem, Jobs said, and the percentage of owners who returned their phones to AT&T was less than a third that for 2009's iPhone 3GS. He also said that while the iPhone 4 drops calls at a higher rate than the 3GS model, the difference is less than one additional call per 100.
"We've been working really, really hard for the last 22 days to try to understand what the real problem is, so that when we solve it, we actually solve it," Jobs said near the end of the press conference. "And we think we've gotten to the heart of the problem."
Computerworld's Ken Mingis contributed to this report.
Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer or subscribe to Gregg's RSS feed . His e-mail address is firstname.lastname@example.org.