By Jason Theodorou

Apple were aware of design problems in the iPhone 4 device during the development process, according to news service Bloomberg. Engineers informed Apple boss Steve Jobs that the device had reception issues, but Jobs was alleged to have dismissed their concerns because he was so fond of the product's iconic design.

Ruben Caballero, a senior engineer, told Apple that signal quality and reception were hamstrung by the design of the iPhone 4. The device houses its antennae in a stainless steel strip running along the centre of the device.

Caballero allegedly told Apple executives that the device presented a 'serious engineering challenge'. The allegation could harm Apple's reputation, as the company has so far attempted to represent the design flaw as a software anomaly or incorrect operation on the part of the user.

Consumer Reports, a US consumer magazine, rated the iPhone 4 highly in many areas but said they 'could not recommend' the device because of the signal problems. Hundreds of users have said that they experienced dropped calls and poor reception when holding the iPhone 4 in their left hand, which interferes with the device's antennae.

Apple said that Bloomberg's story was made up solely of 'rumours', but the news service said the piece was accurate.

Apple is holding a press conference on Friday to explain how they will address the problems with the iPhone 4. One way in which the company could solve the problem is by issuing free 'bumpers' to customers, protective cases which retail in the UK at £25.

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