Forget the Grip of Death - a duff proximity sensor is iPhone 4’s real hang-up. And it's a problem that turns it from smartphone of the year to a handset I'd be wary of buying.

I'm calling it the Ear of Death.

It goes like this: all iPhones have a proximity sensor that disables the display when you hold the phone up to your head - preventing your ear or cheek from accidentally activating one of its touchscreen buttons.

I’ve been having a couple of strange iPhone 4 experiences, especially when calling voice mail.

At first I thought it was a Vodafone issue.

But comparing notes with other iPhone 4 early adopters yesterday, it seems the problem is that the new handset's proximity sensor is more sensitive than its predecessors.

If you move the phone slightly during a call, the keypad can come alive again.

At times this has meant I’ve inadvertently pressed the “5” on my keypad with my ear while listening to voice mail - deleting a message before I’ve finished listening to it.

Others have inadvertently ended a call.

WELL CHOP CHOP THEN: In a footnote to the July 17 Grip of Death press conference, Apple chief executive Steve Jobs promised to address the malfunctioning proximity sensor with iPhone 4's next software upgrade. Photo courtesy Engadget.

Yesterday, while receiving some bad news by phone - I guess I was agitated and moving it around a lot - I even managed to put my current conversation on hold and initiate a new call (hello, Telecom Wholesale).

I’m not alone in noticing this problem.

A post from an early US customer on Apple’s help forum (now locked for replies) reads:

I'm having an issue with the Proximity Sensor not properly detecting when I'm holding my phone to my ear. I can confirm that the iPhone sensor is working by covering it with my finger, but when held to my face, the screen blinks as if it cannot decide to disable the screen or enable it. It results on me hanging up, putting calls on mute, and dialing numbers accidentally while I'm on the phone. This occurs on 90% of my calls. Is anyone else experiencing this issue. I would like to confirm whether this is a software issue (Proximity Sensor sensitivity too low) or a design issue (sensor now placed towards the end of the phone).

It’s followed by a stunning 113 pages of posts, tracing a similar theme.

Daring Fireball blogger John Gruber says it could be a software problem, and he hopes a future free upgrade of OS4 (the Apple software that runs an iPhone) will address it.

A number of people in help forums say that resetting an iPhone 4 solves the proximity sensor problem.

I’m loathe to try it, since I’ll also lose all my email and wi-fi settings - not the end of the world, but a bit of a hassle.

Now though, I’m annoyed enough to try it.

There’s lots to love about the iPhone 4. I’ve come to much prefer the boxy shape; the high def video means you can bin your Flip camcorder; and I agree with Apple that the retina screen is the sharpest you’ll find on a smartphone. And although I've been able to degrade the signal with the Grip of Death, I'm not sure I'd even notice it if the reception issue hadn't been flagged in the media.

But the proximity sensor issue is starting to really bug me.

Yesterday, at one point, I was on the verge of reaching for my 3GS.

Check in later in the day to see how my reset goes and how Apple replies to my request for an official explanation.

UPDATE: At Apple's July 17 iPhone 4 press conference, which centres around the Grip of Death, MacWorld's live blog has Steve Jobs saying: "[We're] Tracking some problems with the proximity sensor, and we're working on solutions, and we'll try to get it fixed in the next software update."

NBR has requested an update on the software upgrade from Apple.

UPDATE II: For me, an iOS upgrade from iOS 4.0.1 to version 4.0.2 doesn't seem to have fixed it.

UPDATE III: A spokeswoman for 2degrees, which like Telecom sells Micro-SIMs for the iPhone 4, has suggested - NBR assumes in jest - that an ear bumper is in order. 

The spokeswoman - who can't be named, other than that her last name is Hilless and her first name begins with B - also demanded photographic evidence of your correspondent's ears "to determine if it's a size issue" (for the record, I guess they do stick out slightly more than average).

Also failing to appreciate my pain (and, seriously, the problem would stop me buying an iPhone 4 at this point), InternetNZ director Don Christie helpfully tweeted a pic of a prototype ear bumper (above).

UPDATE IV: Apple corporate communications manager Fiona Martin sent the following message to NBR: "Steve Jobs acknowledged this in the media conference he held on 16 July [US time], stating that Apple is aware of the issue and working on a fix that will appear in a future software release."

UPDATE V: The MacRumors website said the iOS 4.1 software update, which a senior Apple staffer is quoted as saying will include the proximity sensor fix, was due in two weeks. But that was four weeks ago.