BizNomic

Consumer Reports magazine said Monday it can’t recommend the iPhone 4 to shoppers, because of persistent reception issues caused by touching the Apple Inc. phone.

The products-review magazine, on its website, also questioned Apple’s explanation for the glitch, saying it tested other smartphones in its labs, including the older iPhone 3GS, and “none of those phones had the signal-loss problems of the iPhone 4.” “Our findings 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.’ Consumer Reports said.

The comments by the product-reviews publication add to a pile of complaints about the iPhone 4′s ability to handle voice calls. Apple has responded with a promise for a software update that will change how the phone decides how many signal bars to show, but Consumer Reports’ tests cast doubt on whether that will solve the problem.

When the iPhone 4′s reception problem first surfaced, Apple said it was a problem shared by all phones in the “wireless world,” and advised consumers to hold the iPhone differently. Two weeks ago, Apple reversed course by blaming software and promised to deliver a software update.

“The antenna problem and Apple’s screwy software response has become kind of a running joke,” analyst Rob Enderle, of the Enderle Group, told CIO.com. A software problem can be fixed relatively easy, whereas a hardware problem carries the potential of a recall.

“No one wants to face Jobs’ wrath if they had to actually do one,” Enderle says.

Consumer Reports, however, did offer an easy fix: “Cover the antenna gap with a piece of duct tape or another thick, non-conductive material. It may not be pretty, but it works. We also expect that using a case would remedy the problem. We’ll test a few cases this week and report back.”

One can just imagine what the ever-aesthetic Apple chief Steve Jobs thinks of that solution. Consumer Reports gave the iPhone 4 solid ratings on display sharpness and improved battery life over its predecessors. It even said the iPhone 4 has the best video camera of any phone. But the antenna problem looms as a major hurdle toward a Consumer Reports recommendation.

The problem is software-related and involves how the phone displays signal strength, according to the company’s July 2 statement. It has said it will issue a fix. Apple fell $2.11 to $257.51 at 1:15 p.m. New York time on the Nasdaq Stock Market. Before today, the shares had gained 23 percent this year.