Earlier we reported that some iPhone 4s were experiencing signal issues when the user touched the bottom left area of the device.  However, it turns out that this may be an issue with the software rather than the hardware.  Many users have recorded videos of both the iPhone 3G and 3GS experiencing similar reception problems.  As seen in the videos below, after upgrading to iOS 4, both devices are losing signal after being held in a palm or held close to the chest.

As I said about the iPhone 4 launch, any sort of product launch rarely goes off without any issues, and the release of iOS 4 is no exception.  While it seems kind of strange that the older iPhones are experiencing the same problem, I suppose the buggy software could be to blame for the problems.  This issue doesn't seem to be affecting every device with iOS 4, as an iPhone 3GS I tested with iOS 4 didn't seem to be having any reception problems.  Some users are still able to place calls even though their device is displaying weak or no signal, so it sounds like the reception itself may be fine and that it's just the software not showing an accurate signal strength.  Either way, I'm sure Apple will be addressing these problems soon since losing a signal sends your phone through a magical transformation into an expensive paperweight.

Via IntoMobile, Boy Genius Report