The carrier’s heavy promotion of aggressively priced wireless broadband and iPhone 3G plans has resulted in the network being overloaded with users, leading to widespread performance problems and frequent outages. The worst of the complaints have come from Sydney, where users have been forced to drop down to the inferior 2G network just so they can receive calls. But customers around the country are reporting problems including call dropouts and slow internet speeds.

As soon as an iPod or iPhone is plugged into the PC, Windows Vista crashes and shows the “blue screen of death” (BSOD), the critical error screen on a blue background that requires a reboot to recover, users said. The errors began showing up immediately after customers updated iTunes to Version 8.0, which Apple released Tuesday as part of its iPod refresh.

Consumers increasingly want more sophisticated mobile handsets, and smartphone sales are expected to grow 52% this year compared to last year, according to Gartner. The firm adds that smartphone sales will reach over 700 million units, accounting for 65% of all handset sales. This will represent nearly $200 billion, Gartner said.

The vast majority of people in Australia experiencing the iPhone 3G problems are Optus customers. Many have reported their experiences on the Fairfax MashUp blog, as well as local Apple community MacTalk.

The Swedish report said the most likely cause of the 3G problems is defective adjustments between the antenna and an amplifier that captures very weak signals from the antenna. This could lead to poor 3G connectivity and slower data speeds.

Users in Australia, Europe and the US have flooded online forums - including Apple’s own discussion boards - with complaints of poor reception, slow internet speeds and dropped calls. The poor reception - often displayed as one bar - and slow speeds are occurring in areas of good coverage and do not seem to affect other phones.

The high page count stems from Optus and Telstra unnecessarily itemising each individual piece of web data downloaded using the phone, instead of having a single usage figure for each day. One customer estimated that if he had used his full 850MB allowance his bill would have been more than 80 pages.

Apple is reportedly about to launch a ‘nano’ version of the hugely successful iPhone. It is expected to be in the shops in time for Christmas. The new slimmed-down version of the iPhone is expected to outstrip sales even of the original.

While Telstra remains the most expensive Australian mobile carrier, the mobile broadband price cut is the most significant change since it activated the Next G network almost 22 months ago. Telstra has previously defended its lofty costs on the basis of a “premium” product, because Next G was faster and offered bigger coverage.

Apple Chief Financial Officer Peter Oppenheimer’s decision to warn financial analysts Monday that Apple’s fourth-quarter gross margins will be negatively impacted by a “product transition” should be enough to get the rumor wheels turning: of course, it doesn’t take all that much. Let the guessing begin!