Well I satisfied my curiosity about whether this is a design flaw or
not. It is NOT a design flaw. Let me explain. I walked into an Apple
store to see iPhone 4 and test the "grip of death" that has been on the
web news and blogs. I held every one of the 20 iPhone 4 display units
in the grip of death. Out of the 20 only 4 suffered dropped bars the
other 16 stayed at 5 bars no matter how long I held them in the grip.
Now this is a small sampling but much larger than most have done. The
results show that 20% suffer from the dreaded grip of death. There is
something else of a technical nature causing the problem, but it isn't
the design. If it was hen all 20 in the same room would have dropped
bars instead of just 4. Maybe it's manufacturing related, a component failure or how the
software chooses the signal, but it should be fixable once Apple
diagnoses what is causing this.
Wrong. FAIL. AT&T strategically makes sure that signal strength is high around Apple and AT&T stores. After all, they wouldn't want a customer walking into their store and testing a phone out and seeing only 1 bar, right?
The drop of bars is 100% related to the quality of the signal. If you have a very good quality signal AND have 5 bars, you will not see the issue most likely. If you have a mediocre quality - BUT still have 5 bars (i.e. you're on the fringe of going from 5 to 4) you'll see the drop start to occur. If you have 3 bars, or 2 bars, then god help you - you're screwed.
I reproduced this issue EVERY single time in my bedroom where I have poor signal. On my balcony, I could only reproduce it 1 out of 5 times.