• Inferion’s inferior chipsets: Business Week, MacRumors and CrunchGear all reported that flawed software on Inferion’s chipsets inside the mobile device are responsible for the iPhone’s tendency to switch from 3G to EDGE networks, often dropping calls in the process. These sources also claim that Apple will address this problem by issuing a software update by the end of Sept.

• Growing pains: Tragically illustrated with an iPhone going down the drain, Wired magazine looked to a number of sources to find the root of the 3G problem. Some were more forgiving than others. An Airvana executive attributed the problems to a network in its infancy. As per the normal course, it could take several years to optimize the network, he said. Not to mention that AT&T is still deploying its 3G equipment on existing transmission towers, which are spaced according to 2G needs – meaning 2G might actually have better coverage in some areas where 3G can’t reach.

• Hardware meltdown: Reports from the AP, based on a Swedish engineering magazine, have placed the responsibility on defective adjustments between the antenna and an amplifier that captures weak signals from the antenna. Research firm iSuppli took it one step farther, saying the problem could stem from anywhere in the physical handset, from the antenna and amplifier and the RF transceiver to the baseband that processes the digital signal and sends it to the speaker or screen.

• “What we have here is a failure to communicate”: Many simply agree with Paul Newman, that these problems are another manifestation of the disconnect between AT&T and Apple. Some overseas carriers are placing the blame on Apple, taking the onus off of AT&T. Still, many are quick to accuse of AT&T of not providing enough bandwidth in high density areas. Telephony’s Wireless Editor Kevin Fitchard explored this possibility at the handset’s launch.

• 300-deep lines of Apple fanatics: Just like its predecessor, the iPhone 3G sold out within hours of Apple and AT&T opening their doors on the launch date. It could be the case that the two were not prepared for the enormous response they received. Going back to the bandwidth debacle, cell sites may simply not be able to handle the surge of new iPhone owners.

• Is it all in your head?: Thus far, AT&T, Apple and Inferion have remained relatively quiet on the complaints. Inferion pointed out that its 3G chipsets work fine in Samsung handsets, which is more than Apple or AT&T will even say. Apple has yet to acknowledge the problem, and its wireless partner has only maintained the phone’s doing great. According to Business Week reports, the dropped call issue is affecting 2% to 3% of iPhone traffic as compared to AT&T’s average dropped-call rate of around 1%. So, while the attention given the issue has been significant, it is arguable that the actual issue isn’t that abysmal.

This is certainly not the first time a 3G handset has had problems with the network, yet this is arguably the first time it has elicited this level of concern. No other handset has been watched with the level of scrutiny applied to the iPhone, generally thought to be the be-all-end-all archetype for a mobile multimedia device. With the onslaught of 3G complaints, has the industry messed up its biggest opportunity to bring mobile data services to the forefront, or are we just overacting at the first sign of a roadbump? Where do you place the blame?

Please post your comments below.

For as many eager buyers as there were in line, there were just as many rumors and misconceptions about the iPhone making their way up and down the line. Most people waiting had questions concerning the contracts, switching providers, adding to their family plan and, more than anything, how much they would actually be spending. Most of those without questions, were relying on rumors they’d heard in the blogosphere: More shipments were coming that afternoon. (Probably not.) You could order it online within the week. (No.) You didn’t have to have an AT&T contract if you paid more out of the gate. (Nope, not yet.) Tight-lipped AT&T employees weren’t offering many answers either (although as one pointed out, Apple doesn’t like to reveal that much to them).

Most the confusion centered on the actual cost of the device, and according to Piper Jaffray analyst Gene Munster, the uncertainty might be justified. Munster predicted that only 35% of buyers will actually get the $199 price that has caused so much buzz. In a research note, he said that “though Apple advertises the 8GB iPhone 3G will sell for $199, we estimate that the average entry level price point will actually be $407.” Based on a survey of 200 mobile phone users, the firm found that a majority will not be eligible for AT&T’s subsidy and the activation fees that AT&T will be charging.

Munster predicted that because of this most buyers will wait until their contract on their current carrier expires, or AT&T subscribers become upgrade eligible. If Chicago stores are any indication of the handset’s success, however, sales for day one weren’t hurting. Granted, the supplies were low, but the demand still exceed it. More than 300 customers waited at Apple, the first arriving in the rain before dawn. Despite customers’ confusion, all were eager to get the new handset – some regardless of price or the fact that they had a perfectly good one in hand, some already equipped with new games and features from the app store launched yesterday.

AT&T wouldn’t reveal much to their confused customers. More shipments are coming, but they wouldn’t say when. Stores sold out – first of the 16GB black model, but they wouldn’t say how many each had. Considering this, it will be interesting to see if day one sales really are diluted as Munster predicts, or if it just the information given about the handset that proves to be diluted on launch day.

Did you brave the crowds and get an iPhone 3G? Have any initial reviews or launch-day stories? Please post your comments below.

And the problem is going to get worse.
(more…)

I struggle a bit to even type this, given that it puts my jaded journalist status somewhat at risk, but AT&T Chairman, President and CEO Randall Stephenson gave one of the better keynote speeches I’ve heard from an executive at his level yesterday to kick off NXTcomm.

 Stephenson took the stage after the obligatory 20 minutes of rock music blared out at a large audience that included the service provider customers for the show as well as exhibitor personnel.  (I’ve never understood why conferences use contemporary rock to introduce sessions which don’t feature any speakers under 40, but that’s just showing my age).

He proceeded to give an address that I thought was inspiring in that it highlighted the real potential ahead for telecom and challenged everyone present to work together to make it happen. I know that sounds cliched but he pulled it off, stressing the key points of velocity, connectivity and mobility as the way to stimulate economic growth and generate prosperity.

I happen to believe Stephenson is right - the telecom industry has much to contribute to improving the quality of life, reducing energy consumption and thus protecting our environment, improving education, lowering the cost and improving the quality of health care and helping stimulate our flagging economy.

Stephenson once again kicked off his speech with a bit of personal humor — last year, he had joked about discovering that becoming chairman of AT&T didn’t get him out of taking the trash out at home. This year, he confessed to watching Tiger Woods win the U.S. Open playoff round Monday on his iPhone, but quickly added, “I hope no one else at AT&T was doing that.”

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The Las Vegas heat has probably put a damper on some post-show activities and certainly prompted many to scramble from the air-conditioned convention center to the air-conditioned shuttle buses or cabs. I made a discovery early on — mix 110-degree heat with black handrails on outdoor escalators and you get a sticky black mess on your hands.  So those of you taking the monorail to get around Vegas, beware what lurks ahead on the escalator.

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Ever heard of the Water Coolers? I hadn’t either until Tuesday night’s NXTcomm Exception Reception in honor of the EOS Award Winners and DiversityNXT award winners.  The Water Coolers are a five-person a capella singing group that is also a comedy act, rewriting the words to familiar songs to poke fun at other topics, and last night they wowed the NXTcomm crowd with songs about airline delays, Blackberry addictions and even  Net Neutrality. The latter had the crowd hooting as the lead male singer sarcastically invited Congress to come in and take over running the telecom industry into which billions of private money had been invested. Maybe it’s the group’s San Francisco roots showing, however, when at the last minute, a female singer piped up about the other side of the story.

 I hear constantly from people in the industry about their efforts to design and deliver innovative new services.  Equipment vendors, software makers, service providers all talk about the telecom industry’s need to generate new services and new service revenues.

But what have you done about it, within the last year?

Here’s your chance to show the world. The nomination process for the Telephony Innovation Awards is well underway,  and we are looking for all different types of innovative services.

Hardware and software vendors, it’s time to nominate your best customers. Service providers, it’s time to do a little bragging.

The nomination process is open to everyone, although only service providers can win. It’s simple and straightforward — just log on, and tell us what you are doing right.