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You definitely cant see my sensor glowing red like that on my iPhone 4 running iOS 4.1. Thats a pretty weird video..
 
Yeah, I noticed that. The video doesn't really show it well, as you can always see infrared with a camera. The sensor is visible to the human eye now

Yeah, but there's no other way to demonstrate it. Note, however, the side by side with the 3GS you can't see the sensor. So as a relative reference, the iPhone 4 appears significantly stronger.
 
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