PALM Palm (MM)

Apple Inc.'s (AAPL) new iPhone might perform a simple task much better than its predecessors: Hold a phone call.

Last week, Apple unveiled the latest iteration of its popular smartphone, dubbed the iPhone 4. Among the most dramatic design changes is a stainless-steel antenna that wraps around its sides.

The new antenna design constitutes a radical departure from previous iPhone models, which buried the antenna under the phone's shell. The new phone puts out more radio-frequency radiation than its predecessor, according to Federal Communications Commission documents. That is expected to give it greater signal strength and reliability.

Apple hopes the new design will counter one of the most common complaints consumers have with the iPhone: dropped calls. If it effectively deals with the problem, which has dogged the device since it first went on sale in June 2007, the iPhone's new antenna could spur further adoption of a product that has turned into Apple's biggest growth driver.

Since the iPhone's debut, Apple shares have more than doubled. In late morning trading Monday, Apple shares rose $1.94 to $255.45.

Apple didn't respond to requests for comment.

The elevated radio-frequency radiation meets FCC safety guidelines. Radiation emission from the device is roughly in line with similar smartphones from Palm Inc. (PALM) and Research In Motion Ltd. (RIMM), according to FCC test results.

Though popular with consumers, Apple's iPhone has been beset with complaints about dropped calls. The problem is so persistent that Comedy Central's Stephen Colbert, an avowed Apple fan, joked recently that the company's new iPad tablet computer was just like an iPhone because "you can't make calls with it."

At a conference before the announcement of the iPhone 4, Apple Chief Executive Steve Jobs suggested AT&T Inc. (T), the iPhone's exclusive carrier in the U.S., was to blame for the poor connections. He said the carrier was working to upgrade its network to address the problem.

An AT&T spokesman declined to comment on the iPhone 4's design but said the company continues to invest in its network.

Of course, there is no guarantee that the new design will address the problem. "This is a very difficult thing to do," said Robert Thorpe, an antenna-and-radio-frequency consultant, adding few companies have used such an unorthodox design.

And if AT&T's network remains congested, the new antenna may have minimal impact. Too many customers jockeying for airwaves will inevitably result in some users getting bounced.

Still, Apple's antenna boasts impressive characteristics.

It is among the largest available on a cellphone, wireless professionals say, and uses separate parts of the steel band to carry different radio signals. Those include Wi-Fi, GPS and cellular.

Combined with the bigger antenna, the increased energy will likely give the device better signal strength, which should let it hang on to calls better.

"A large antenna has a massive impact on how the device interfaces with the network," said Nielsen telecommunications researcher Roger Entner. Entner, who has been critical of the iPhone's radio technology in the past, said the new design will be a "massive improvement."

-By Ian Sherr, Dow Jones Newswires; 415-439-6455; ian.sherr@dowjones.com

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