I have had the exact same problems over the last month. At times, my signal strength will get lost and go into "searching" mode for about five minutes, then go to Edge network, where I know there is 3G coverage. All my calls get dropped after approximately one minute, then gives me the "called failed" option to call again, but cannot re-engage the call. After all these problems, I finally took my phone into an AT&T store...they swapped out my SIM card, hoping that this would resolve my issues, but to no avail. I tried everything, soft resets, hard resets, resetting the phone back to factory settings...nothing. After the swap and still having the same problems, I took the phone into an Apple store....they listened to my story and said, "You definately have a bad phone" and swapped it out for a brand new one. I took it home and restored the brand new phone to my most recent baHckup. Did it change anything....nope! I had the exact same problems. I also tried not restoring the new phone with an old backup, thinking something may be wrong with my old backup, but still the same set of problems. I called tech support with AT&T and Apple. I spoke to several people. They currently have an open case on my problem and said it is a network problem, rather than a software/hardware problem. My phone for some reason has massive problems using the 3G network, but no problem when at home on my Wi-Fi. Currently my 3G setting is disabled and on Edge so I can text and use the internet. As soon as I get home, I'm back to Wi-Fi. AT&T has been working on my problem for a week now and said as of yesterday, they are still working on it. I would suggest you calling AT&T to get a case started, so that they can fix your issue. Hope this helps.