Consumer Reports: Still Not Recommending iPhone4

Consumer Reports said Apple's offer of free cases for the iPhone4 to alleviate reception problems are "a good first step" towards identifying and finding a solution for reported signal-loss problems with the new phone.

But the magazine is still not recommending the latest iPhone

"Apple has indicated that this is not a long-term solution, it has guaranteed the offer only through September 30th, and has not extended it unequivocally to customers who bought cases from third-party vendors," the magazine noted in a statement posted on its website Friday.

"We look forward to a long-term fix from Apple. As things currently stand, the iPhone 4 is still not one of our Recommended models," Consumer Reports said.

After testing the phone Consumer Reports had found a problem with the uniquely-designed, built-in antenna which wraps around the edge of the phone.

Just by holding the phone in a certain way could block reception - what mocking buyers call "the death grip."

Jobs has said that the iPhone 4's antenna issue isn't widespread, with just over five out of every 1,000 (or 0.5%) complaining to Apple's warranty service, and less than 2 percent returning the device.

But with Apple's stock taking a hit and the phone becoming the butt of jokes by late-night comics, Apple had to act, reports CBS News correspondent Bill Whittaker.

On Friday Apple CEO Steve Jobs acknowledged "We're not perfect, phones aren't perfect. But we want to make all our users happy." He tried to do so by announcing that iPhone4 users would receive free protective "bumpers" (worth $29.99) for their units.

Jonathan Benarroch, who had called Apple to tell them him problems with the phone, told Whittaker that the bumpers are "a bandaid."

On CBS' "Early Show on Saturday Morning" technology expert Katie Lindendoll said the reception problems are as much a technology issue as a customer service and PR issue.

She said Apple hopes to have the dropped-call problem resolved by September. "For now this is the best they can do," she said. "It was imperative they offered something."

And sales haven't been hurt: "Go to any store in New York, you cannot find an iPhone4," said Lindendoll. "The phone is doing remarkable, jam-packed with features."

She dubbed the reception problem "a version 1.0 mistake."