After all the speculation that the iPhone 3G would be “the best phone EVER!”, it has been a little less then what we all expected. Complaints over dropped calls and slower then expected internet, have sparked waves of speculation of what could be the source of the problem.

Richard Windsor of Nomura Securities, believes the problem is in fact is a faulty communications chip made by the Munich-based Infineon Technologies. The chip is what makes the iPhone 3G, 3G.

Some users of the iPhone 3G complain that they are unable to achieve the promised faster speeds of the 3G network. While dropped calls during network handoffs between the 3G and EDGE network are affecting up to 3% of users. On the entire network, AT&T's regular dropped call rate is 1%.

There is speculation that the issue could be remedied with a simple software update instead of an expensive and disruptive recall. The software update would fix any issues with the iPhone and Infineon chip software. Another issue could just be that there are too many iPhones vying for network resources that just aren't available. 

Apple hasn't commented on the issue.