CUPERTINO, Ca. – After his third iPhone 3G continued to cut him off in the middle of his conversations, Ryan Shaw had seen enough.

“The phone was a disappointment from the standpoint that it couldn’t maintain a consistent connection with the 3G network…All the other features were fantastic,” Shaw, a sales professional living in a Cleveland suburb told CNET News.Com. But those other features weren’t enough to prevent him from returning to Verizon and the BlackBerry after deciding the hassle just wasn’t worth it.

Widespread complaints about the iPhone 3G’s reception have spread across the Internet in the month since Apple and AT&T released the successor to the original iPhone. The companies insist that nothing is wrong, but the complaints have been mounting through e-mails, water-cooler discussions, and message boards on Apple’s own Web site: iPhone 3G users are having trouble connecting, and staying connected, to the 3G networks in their areas.

Users say the iPhone 3G will switch between 3G networks and EDGE networks even when the device is sitting still. They’ll lose reception in the middle of a call while traveling through a 3G-rich environment. Friends with other 3G phones on AT&T’s network are not reporting similar problems. And the issues don’t appear to be confined to AT&T’s network: iPhone 3G users in other countries report similar problems with their new phones.

As you can imagine, this doesn’t sit well with many who eagerly bought the iPhone 3G to take advantage of 3G networks, which Apple promises are “twice as fast” as the EDGE networks in its advertising material. “Frankly, if I knew it was going to be like this, I wouldn’t have paid the extra $10 a month,” said iPhone 3G owner David Howard of Provo, Utah.

Repeated attempts over the past week to get Apple and AT&T to even acknowledge the uproar–if not the issues specifically–proved pointless. Apple didn’t even attempt to answer the questions, deferring inquiries to AT&T, which declared that there were absolutely no widespread problems with the iPhone 3G on its network.

“What we’re seeing is that the iPhone 3G is performing very well,” said Mark Siegel, a spokesman for AT&T. “I’m not denying that people are having problems. But we have to deal with these on a case-by-case basis.”

It’s always difficult to determine the scope of an issue posted on Internet message boards–whether or not a loud minority is blowing up a relatively minor problem into something more. But this time, lots of different people are crowding the Internet to vent their frustrations and search for answers to the reception issues, and they are finding a lot of sympathizers.

Without detailed testing, it’s also difficult to say for sure what is causing the dropped calls or limited access to the network. Most likely, the cause of the problem is not solely an AT&T network issue nor is it an Apple device issue: It’s a combination of both.

The network

AT&T’s 3G network is not ubiquitous. Currently, AT&T offers 3G service in only 300 major metropolitan areas. It expects to get to 350 metro areas by the end of the year. By contrast, AT&T’s 2.5G EDGE network, which is what the first-generation iPhone uses, is deployed throughout AT&T’s entire nationwide footprint.

For iPhone 3G users this means they should be able to get 3G coverage in the areas marked by AT&T’s coverage map. Many of the problems, however, are being reported in just those places. Some residents of San Francisco, Chicago, and New York–among the first destinations for AT&T’s 3G network technology–report spotty 3G availability on their iPhone 3Gs, but excellent EDGE performance.

That suggests either a hand-off issue or a capacity issue. The hand-off between the two networks is supposed to be seamless: 3G calls should automatically switch to EDGE when the 3G signal gets too weak. But the iPhone 3G seems to be hanging when it switches from the 3G network to the EDGE network, dropping service altogether in some cases. Apple technicians who examined Shaw’s phone found that 36 percent of his calls had been dropped.

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