3G reception issues - rushed firmware.
Well, reading between the lines of the unpunctuated drivel on a lot of Apple user sites (I'm put off an iPhone again! Tch, maybe Webster's right...) - including "take out your sim card and polish it, that'll cure the problem" (durrrrr if your SIM hasn't got good contact you probably won't get the iPhone onto any network - is it in Flight mode? I think not)... I reckon the first iteration of teh 3G iPhone has suffered from the usual bugbear of multimode, flipping to 3G too soon and staying too late. This results in awful overall service, and I can see the pattern emerge where people (usually furious people) post they leave their iPhone on EDGE (nuff said, these are not the brightest peeps) and get good service.
Holy Flip flopping iPhone, Batman! Dual mode network issues in a first gen firmware? Whod'a thunk it?
Incidentally, I spent 7 years protocol testing mobiles, including dual mode ones. There's no substitute for drive testiing (i.e. driving about and finding blackspots in coverage - like J10 of the M4) and soak testing, and if you don't do it properly this is what you get.
Rush job as usual - output = shite software.