These same people, if this flaw existed in a BlackBerry or WM device, would be crowing about how stupid those companies are and how superior Apple's hardware and software is. Because the problem is with an Apple device, it isn't a problem, or the other devices are just as insecure, so what's the problem?
Here's the problem: the encryption doesn't work. It doesn't protect your data. And yes, it's a problem because it's easier to steal an iPhone than you might think, even if you claim to have never lost a device. You seem to think industrial espionage is some theoretical idea. Why don't you ask Apple about that? It isn't a theory to them, it's a reality. Knowing how paranoid Apple is about security and keeping leaks under wraps, you seriously argue that encryption failure is not a problem? Children please. Go ask Steve Jobs if it's a problem.
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