More than a quarter of iPhones break within 2 years

iPhone 3GS more reliable than 3G, but iPhone 4's glass back concerns warranty firm

More than one in four Apple iPhones break or fail within two years, a company that provides after-sale warranties said today.

SquareTrade, which sells extended warranties for the iPhone, said that 26% of Apple's smartphone suffer a breakdown -- or simply breakage -- within the first two years. But that's an improvement over the iPhone's past reliability rating.

"Twenty-six percent is actually pretty good," said Vince Tseng, vice president of marketing at SquareTrade. "And it's encouraging that the failure rates have decreased."

According to SquareTrade, which examined more than 25,000 customer warranty claims, the iPhone 3GS is more reliable, and apparently sturdier too, than its predecessors, the iPhone 3G that first went on sale in July 2008 and the original model, which debuted in 2007.

Last year, a similar SquareTrade analysis found that 31% of all iPhones failed or were broken during the first 24 months of ownership, compared to today's 25.6% of customers who have owned an iPhone during the last 22 months.

iPhone claims based on both hardware failures and accidents -- SquareTrade's warranties covers both -- were lower this year compared to 2009. While 21% of iPhone-owning customers reported an accidental damage claim and 10% filed a hardware failure claim in the 24 months preceding last summer, only 18.1% and 7.5% filed an accident or hardware-related claim in the 22 months prior to June 2010.

Phones kept longer than standard two-year carrier contract, of course, fail at a higher rate. SquareTrade's forecast: Three-year-old iPhones will sport a failure rate of 35%-40%.

Tseng credited improvements that Apple made to the iPhone 3GS's touchscreen for most of the lower number of warranty claim rates in the last 22 months.

"The iPhone 3GS is sturdier and can withstand a higher degree of shock," said Tseng, referring to the drop in accident claims, the bulk of which are due to dropping the smartphone. "But the overall reliability of the iPhone has improved, especially in the touchscreen."

The iPhone 3GS has fewer than half the reported touchscreen problems as the iPhone 3G, SquareTrade's data showed. Overall, Tseng estimated that the iPhone 3GS will have 20% fewer issues than the iPhone 3G.

On the downside, iPhone 3GS owners have reported almost 50% more power issues than those with the older iPhone 3G.

The past year's improvement in iPhone reliability will likely continue, said Tseng, a good sign for the millions who have ordered the iPhone 4, which Apple will start selling Thursday.

"Over the last years, Apple has gotten its manufacturing lines in shape and failure rates have dropped year to year," said Tseng. "The iPhone 4 should be a good, solid device."

But Tseng has one major worry about the new iPhone: The all-glass back.

With the iPhone 4, Apple switched to a glass back, dropping the plastic cover of the iPhone 3G and 3GS. Industry watchers have speculated that Apple went for the glass to improve call and data reception, problems that have plagued the smartphone since its 2007's launch, especially in high-density cities such as New York and San Francisco.

"It all depends on how consumers treat the device, of course," said Tseng. "The front glass touchscreen has been fairly prone to cracking, but then people don't put protective covers [that shield] the front of the device."

The best way to protect any iPhone, said Tseng, is with a cover, case or silicon skin.

SquareTrade's latest iPhone reliability report can be downloaded from the company's site ( download PDF ).

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Gregg Keizer

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