It's called "TDMA Interference" and it's an unavoidable side effect of how GSM phones work. It doesn't happen with CDMA phones (i.e. Verizon), but nearly all GSM phones including AT&T and T-Mobile are susceptible to it.
TDMA Interference happens any time the phone communicates with the cellular tower, and is part of why the iPhone doesn't work with all the dock-connector speakers that standard iPods use.
Most speakers will relay that squawking noise whenever the phone is in the dock, or even just near it. The annoying buzzing is related to the TDMA frequency related to the timeslot length (frequency is inversely proportional to the timeslot length). It's basically a function of the nature of the modulation technique of TDMA.
RadTech has a unique solution to TDMA interference - move the offending device (the iPhone) away from the speakers. Their iPhone Dock Extender does just that by extending the iPhone two feet (64cm) away from the speaker. It's a Apple Dock 30-pin Male to 30-pin Female cable that retails for US$39.95.
The Dock Extender Cable allows you to dock your iPod or iPhone from a distance, or while in a case. Small diameter, ultra-flexible cable provides connection pathways for power, audio output, USB data sync, play controls, accessory power and composite video. It does not support S-video output or input for recording audio. Compatible with iPhone, iPod (touch, classic, video), & iPod nano (2nd & 3rd Gen).
What do you do to combat TDMA interference?