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  • Bernstein Research Places iPhone 4 Recall Price Tag at $1.5 Billion



    If there is any reason why Apple isn't going to recall the iPhone 4, it may be because of this. According to the calculations presented by Bernstein Research analyst Toni Sacconaghi, embarking on a full product recall would cost an estimated $1.5 billion. And while many are calling on Apple to "do the right thing" and fix the problem before consumer frustrations and corporate image problems are allowed to simmer any longer, it now appears that the cost of a recall would be substantial enough to ensure that cries for a recall will continue to fall on deaf ears.

    The prospect of an iPhone 4 recall seemed outlandish and almost unimaginable until Consumer Reports tore into Apple over its lingering antenna issue and effectively pulled its recommendation for the hugely popular smartphone. In the last twenty-four hours, everyone from prominent media organizations to small tech blogs have broached the subject of a possible recall. On Tuesday afternoon, Sacconaghi put the cost of a recall into perspective by estimating that it could run Apple some 3.5 percent of its total cash on hand.

    It could be done immediately, would directly address the Consumer Report's concern, and would be financially immaterial. While it would force Apple to 'acknowledge' a design issue with the iPhone, we believe that consumers are increasingly aware of the antenna issue, and remedying it rather than dismissing or ignoring it appears most appropriate.
    Of course, the biggest problem facing Apple isn't the impact of the "Death Grip" on current iPhone 4 sales. The device is already a huge success. The real and much deeper problem relates to the future of Apple and its product releases. "Perhaps the bigger, longer-term concern for Apple investors is the emerging pattern of hubris that the company has displayed," says Sacconaghi, "which has increasingly pitted competitors (and regulators) against the company, and risks alienating customers over time."

    CNET
    This article was originally published in forum thread: Bernstein Research Places iPhone 4 Recall Price Tag at $1.5 Billion started by Michael Essany View original post
    Comments 145 Comments
    1. Rokesomesmeefer's Avatar
      Rokesomesmeefer -
      Quote Originally Posted by Mushy4u View Post
      Let me rephrase that. No one gives a rats *** about recall except iphone users. At least not to this extent. And ofcoarse your going to post a link showing me otherwise. Also, why are you commenting every 5 seconds on this thread.
      Then I, too, shall rephrase. You, sir, are a dumbass.

      Quote Originally Posted by kuhndsn View Post
      Interesting... I did the search... Phones blowing up by the ear, melting battery, microwave issues...
      Safety seems to be the driving factor.
      I wasn't saying whether or not the recalls were safety related. A dumbass claimed that no other cell phone has recalls, and a simple Google search would have saved his first post from being a complete waste.
    1. crimson_fried's Avatar
      crimson_fried -
      You know, I've had this phone since the day it was released and not had ONE problem out of it so far. Maybe I'm an idiot but when I get a new IPhone (and my IPad), the first thing I want to do is get a screen protector and a case on it so that nothing gets scratched. I do not see the need to walk around without a case just so people can see what phone I have, my life is not that empty and I have no reason to try and make people like me. So to all the idiots having problems with the "death grip", put a case on your phone and shut up about it already. It's like no matter what is released or what these companies come out with, people want to whine and cry about anything and EVERYTHING that they can find "wrong" with an item. If all you want to do is search for something to be wrong with everything you buy, why buy it to start with?

      Put a case on your phone (put on a clear one if you MUST have people see the apple logo) and move on with your life guys. I've not had one dropped call or loss of signal, period. I also have numerous friends around this area that have the I4 and not ONE of them have these problems because THEY PUT A CASE ON THEIR PHONE.

      All this death grip talk got old about 2 hours into the release day. What's next? Someone going to blame Apple and the phone when you wreck your car while trying to text and drive?

      edit:
      And to the idiots that want to whine "i dont like cases on my phone"....SHIELD FOR THE THING AND SHUT UP. Whats the big deal with putting a protective CLEAR layer on your phone and moving on with life? "I dont have the money"..."they cost to much"....um, why the hell do you have an IPhone to start with then? If you can afford a $15 PROTECTIVE solution for your phone and your "problem" then I'm guessing the money you spent on the phone could have -should have- gone to pay a bill to start with.
    1. exp1icitc0nt3nt's Avatar
      exp1icitc0nt3nt -
      Dude I agree that thisnis blown way out of proportion. If u use the phone without a case then ur not the most intelligent person anyway. Get a case and stop the complaining. Ur talking about a 5.00 fix from eBay.
    1. kuhndsn's Avatar
      kuhndsn -
      Quote Originally Posted by dale1v View Post
      Yes, but this does not mean that he is not a millionaire from the shares he owns. Apple isn't a charity, lol.
      Possibly because he was the founder/inventor.

      Hmmm
    1. Rokesomesmeefer's Avatar
      Rokesomesmeefer -
      Quote Originally Posted by exp1icitc0nt3nt View Post
      Dude I agree that thisnis blown way out of proportion. If u use the phone without a case then ur not the most intelligent person anyway. Get a case and stop the complaining. Ur talking about a 5.00 fix from eBay.
      Yes, because anyone that appreciates the work of art that is the outward appearance of the iPhone4 is truly an idiot.

      Pardon my sarcasm.
    1. dale1v's Avatar
      dale1v -
      Quote Originally Posted by exp1icitc0nt3nt View Post
      Dude I agree that thisnis blown way out of proportion. If u use the phone without a case then ur not the most intelligent person anyway. Get a case and stop the complaining. Ur talking about a 5.00 fix from eBay.
      Sorry if people want to use the nice phone without the unwanted bulk or aesthetic restraints of a case. Seriously? You're correlating preference with intelligence and justifying a faulty device with an extra purchase? You don't see anything wrong there?

      Quote Originally Posted by kuhndsn View Post
      Possibly because he was the founder/inventor.

      Hmmm
      Hmmm yes I know. At the same time he is conducting his business in a manner that will maximise profit and increase the value of his shares, and in turn make him wealthier. So why did you bring up the oh-so-humble paychecks?
    1. Xtremeiphone's Avatar
      Xtremeiphone -
      apple is not going to do anything about this problem. We should not expect a fix.
    1. delusion950's Avatar
      delusion950 -
      thats a lot of money. but apple would rather exchange it than recall it.
    1. kuhndsn's Avatar
      kuhndsn -
      Quote Originally Posted by Rokesomesmeefer View Post
      Then I, too, shall rephrase. You, sir, are a dumbass.



      I wasn't saying whether or not the recalls were safety related. A dumbass claimed that no other cell phone has recalls, and a simple Google search would have saved his first post from being a complete waste.
      Lmao. Concur.
    1. back9player's Avatar
      back9player -
      Could the proximity prob be related to screen protectors?

      I noticed the other day, when I was looking for one, because for some reason nobody has accessories in stock for the 4, that there was this obscure protector that had the sensors cut out.

      Hell, I'm forced to use my factory cover until my power support one is finally manufactured and shipped to me..
    1. thekid05's Avatar
      thekid05 -
      I honestly dont know what the big deal is... I rarely loose reception even with at&t's tared reputation, and the "grip of death"...come on! you have to squeeze the phone like your intending to break it for all 5 signal bars to be depleted, and yea it has some software issues I admit, when I'm engaged in a phone call, the screen does some things on its own, but so did my 3G and 3GS, I've gotten used to it. But all this bad PR, not necessary...
    1. kuhndsn's Avatar
      kuhndsn -
      Quote Originally Posted by dale1v View Post
      Sorry if people want to use the nice phone without the unwanted bulk or aesthetic restraints of a case. Seriously? You're correlating preference with intelligence and justifying a faulty device with an extra purchase? You don't see anything wrong there?
      Good point that most miss. For me this is a non problem. However if someone has a death grip problem and wishes not to have a bumper then it is a problem. Unfortunatly some posts are just a little on the ignorant and childish side. They want their phones fixed but wish death. I also believe a lot of the haters don't even own a phone. Perhaps after summer break we won't see as many childish remarks. Lol
    1. sucram6791's Avatar
      sucram6791 -
      there is no way they will do a recall

      just hand out bumpers and there will b nothing to complain about
    1. Rokesomesmeefer's Avatar
      Rokesomesmeefer -
      Quote Originally Posted by thekid05 View Post
      I honestly dont know what the big deal is... I rarely loose reception even with at&t's tared reputation, and the "grip of death"...come on! you have to squeeze the phone like your intending to break it for all 5 signal bars to be depleted, and yea it has some software issues I admit, when I'm engaged in a phone call, the screen does some things on its own, but so did my 3G and 3GS, I've gotten used to it. But all this bad PR, not necessary...
      You don't "have to squeeze the phone like your intending to break it" to make it happen. For some people it is as simple as touching only the spot between the 2 antennas to duplicate the issue.

      I think what many people fail to realize is that this is simple conductivity at play. Humans are very good conductors, and there are variables that can increase or decrease a human's conductivity, such as hygeine, diet, environment, etc... It is very possible, and likely, that two different people could each have a different effect when touching the phone in the same manner.
    1. kuhndsn's Avatar
      kuhndsn -
      Quote Originally Posted by dale1v View Post
      Sorry if people want to use the nice phone without the unwanted bulk or aesthetic restraints of a case. Seriously? You're correlating preference with intelligence and justifying a faulty device with an extra purchase? You don't see anything wrong there?



      Hmmm yes I know. At the same time he is conducting his business in a manner that will maximise profit and increase the value of his shares, and in turn make him wealthier. So why did you bring up the oh-so-humble paychecks?
      Paychecks were in ref to a post by a child that had no clue. As a CEO his job is to set up for profit. No company would want the opposite. Now what needs to happen now is fix the internal problem with it's pr... They should get fired IMO.... And In my opinion the board or directors should make a statement or at least tell steve to do it and not the failed pr...
    1. Oooshaa's Avatar
      Oooshaa -
      I took mine & my gf in for prox. sensor issue they swapped both out no problem
    1. Xtremeiphone's Avatar
      Xtremeiphone -
      i agree everyone needs to stop complaining and just get a bumper, it protects your phone and keeps your bars up, what more could you want. I bet you all these childish complaints and comments are kids that camped out for days to get the iphone and now they are beyond frustrated.
    1. MikeThomson's Avatar
      MikeThomson -
      i just called into tech support to complain about the proximity sensor and my wifi always staying on and they said that the ios 4.0.1 update is within 24 hours away
    1. bigiphoneinreno's Avatar
      bigiphoneinreno -
      My i4 will never go back to Apple....I'll just deal with it. Retire Relax and spend time with your family...It's just a phone. Thanks Steve Jobs
    1. ianbroste's Avatar
      ianbroste -
      Quote Originally Posted by Xtremeiphone View Post
      i agree everyone needs to stop complaining and just get a bumper, it protects your phone and keeps your bars up, what more could you want. I bet you all these childish complaints and comments are kids that camped out for days to get the iphone and now they are beyond frustrated.
      The point is you shouldn't HAVE to have a bumper. It should just work without the bumper. Like I said previously I'm not having any problems but I can definitely see where I would be frustrated if my iPhone 4 didn't work as advertised. Don't forget it was just a "kid" who was the first to ever unlock an iPhone.