The iPhone 4 hasn't even been out for a day, and already, the complaints are rolling in. As Neowin reported yesterday, one of the issues involved the phone's cell reception and its degradation upon being held. What wasn't known at the time was why it happens, or how to continuously replicate the issue.
Insanely Great Mac has posted a video shedding light on the cause of the problem. It seems that Apple's new antenna technology is failing when the bottom left corner of the iPhone 4 is touched. In that corner, as you can see in the picture below, the two available antennas come close to meeting. When connected to each other by a person's hand (like when held in the left hand), some sort of interference occurs, causing the signal to degrade and eventually drop the call.
It's interesting to note that in the first video, even without the iPhone 4 being held, it seems that its reception is worse than that of the iPhone 3GS. The videos below show the reception issue in action. The second one is from Engadget who also ran their own test and found the same issue (phone was purchased today in the UK). No official response has been made by Apple at this time. However, it is important to note that not all iPhone 4 owners are reporting reception issues. Engadget has even made it clear that they could not replicate the issue on their pre-launch review unit.