3G iPhone Connection Problems Chip-Related?

Om has complained about his frustration with the 3G iPhone, which has poor reception and forces him to spend more time on the 2.5G EDGE network than he thought, but the issue may be with Infineon’s 3G chip, according to Richard Windsor, an analyst with Nomura Securities. In a research note today, he said: “We believe that these issues are typical of an immature chipset and radio protocol stack where we are almost certain Infineon is the 3G supplier.” That comment might cheer AT&T, but it’s bad news for Infineon, and perhaps a warning to the chip industry about quality control.

Windsor writes that the problem isn’t likely to be solved with firmware updates, which means Apple could have to replace the chips so users get the performance they were promised. If the chip is the problem, this would be the second large chip failure this summer, with Nvidia’s faulty graphics chips placed in thousands of laptops grabbing most of the headlines so far.

The Nvidia issue appears to be caused by poor packaging, and the company has taken a $150-$200 million charge related to fixing the problem, but neither OEMs nor end customers are happy about the situation — especially Nvidia’s reluctance to disclose the full scope of the failure. I’ve emailed Infineon to see what they have to say about the iPhone chip and whether they make it themselves or outsource production as Nvidia has done with its graphics chips, but given Apple’s tendencies we might have to wait a while until we know the truth.

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