Across the U.S., Europe and Japan, record crowds are lining up for the iPhone 4. The device hit store shelves globally on Thursday and the demand is already overwhelming retailers. Fueling the market's appetite, the nation's most influential gadget critics have called the new smartphone "amazing" and "top of the class."

But there's a problem. Early adopters are reporting major reception issues and screen discoloration. Are the malfunctions severe enough to cause a backlash? Here's what's buzzing on gadget blogs:

  • The Antenna Issue For left-handed iPhone users, this could be a major setback. As apparent on the video below, if you hold the lower left corner of the iPhone, the wireless signal strength degrades. This has been reported on some but not all iPhones:
  • Apple's Response In a statement, Steve Jobs told a number of tech blogs that customers are holding the phone incorrectly:
Gripping any phone will result in some attenuation of its antenna performance, with certain places being worse than others depending on the placement of the antennas. This is a fact of life for every wireless phone. If you ever experience this on your iPhone 4, avoid gripping it in the lower left corner in a way that covers both sides of the black strip in the metal band, or simply use one of many available cases.
  • Did This Satisfy Critics? Not even close. For one of the milder reactions, Engadget's Joshua Topolsky writes: "We know what you're thinking, and we're thinking it too: this sounds crazy. Essentially, Apple is saying that the problem is how you hold your phone, and that the solution is to change that habit, or buy one of their cases. Admittedly, this isn't a problem that exists only for the iPhone 4 -- we've seen reports of the same behavior on previous generations (the 3G and 3GS), and there is a running thread about this problem with the Nexus One. While it is definitely true that interference is an unavoidable problem, we can't help feeling like this is really a bit of bad design. If the only answer is to move your hand, why didn't Apple just move the antenna position?"
  • Screen Discoloration "A number of customers have reported an odd yellow-ish discoloration on the screen of their new iPhones," writes Robert Evans at I4U News. "The yellow spots are apparently residual glue from the screen. Technicians have advised customers to ask for replacement iPhones, rather than waiting for the spots to go away. If you are one of the customers affected by this issue, I'd recommend calling Apple for a replacement now before the iPhone 4 sells out everywhere."
  • That Problem May Just Be Temporary, writes Slash Lane at Apple Insider. He quotes a source familiar with the issue: "Apparently, Apple (or more likely Foxconn) is shipping these products so quickly that the evaporation process is not complete. However, after one or two days of use, especially with the screen on, will complete the evaporation process and the yellow 'blotches' will disappear."