Apple is also offering to give consumers a full refund for undamaged iPhone 4s returned -- with no restocking fee. Finally, the company issued a software update that fixes the way the signal-meter bars appear and other bugs.

"Apple did what they needed to do. They put one of their best corporate assets on the job -- Steve Jobs. He was on vacation in Hawaii earlier this week and he came back for this," said Michael Gartenberg, a partner at Altimeter Group. "This was a problem that Apple had to deal with way beyond just an open letter from Steve on the web site."

Jobs Talks Numbers

Jobs opened the press conference with a presentation that highlighted similar reception problems with competing smartphones. He denied a Bloomberg report alleging that Apple knew about the antenna issue before rolling out the iPhone 4 to market, calling the article "a crock." Jobs also gave journalists an up-close look at Apple's $100 million test facility complete with 17 anechoic chambers.

According to Apple's data, people are reporting better reception with the iPhone 4 antenna than ever before. Jobs noted that only one-half of one percent of iPhone 4 users have called AppleCare to complain about the antenna or reception. And iPhone 4 return rates are a mere 1.7 percent -- less than a third of iPhone 3GS returns. Finally, the iPhone 4 drops about one call per 100, about on par with the 3GS.

"Now when we look at this data, it's hard to escape the conclusion that there is a problem, but that problem is affecting a very small number of users," Jobs said. "I get e-mails saying the phone works perfectly, and they can't understand what this is all about. So we think it's affecting a small batch, but it has to do with inherent problems in smartphones. But we want all of our users to be happy."

Jobs ended his presentation by assuring the crowd that Apple loves its users -- and takes the problems with the iPhone 4 personally. Jobs believes his engineers have gotten to the heart of the problem -- and it's a problem common to the industry. Jobs is essentially accepting the challenge to lead the charge to engineer better antenna technology, but isn't willing to stand alone as the only smartphone maker with antenna issues.

Smoldering Ashes

Gartenberg called the press conference effective. What he saw was a candid Apple responding to the pounding it has received from the media for the last two weeks.

"Several times they called out prominent news outlets and basically said that what they were reporting was incorrect or false. It was a bold thing to do, but I think they felt they had to get themselves formally on the record in a big way," Gartenberg said.

"No doubt the story will continue," he added. "The question is whether Apple has effectively put out the worst of the fire, leaving only smoldering ashes for the next couple of days, or is this going to flare up again?"