Imagine, if you will, a day when the term "wireless" had a lot to do with Morse code. In those days if you wanted to transmit signals, you had to get a license from your national regulatory authority, which in the United States is the Federal Communications Commission. One of the areas where you had to pass a rigorous test was in antenna design. Since then, things have changed a lot.
Probably the thing that's changed the most is that people are allowed to operate radio transmitters without a license, which means, among other things, that you don't need to take and pass a test before you can use your WiFi router or your cell phone. But it also means that most people don't really understand how a radio antenna works, or for that matter, what it does.
The reason I mention this is the current round of complaints about poor reception with the iPhone 4. Apple's response is to not hold the device so that your fingers cover that thin black band on the lower left of the iPhone 4's outside edge. The reason this causes a reception problem is that this thin black band (and a similar one on the other side of the device) is actually the insulator that separates two antennas, one for the UHF part of AT&T's voice band and the other the microwave 3G, WiFi and GPS signals.
When you touch this thin black band, you provide an electrical pathway between these two antennas. How much of a pathway you create depends on your personal physiology and the conductivity of your hands. Your hands can change these characteristics when they're wet, and especially if they're sweaty, since perspiration contains salt, which aids in conduction.
It's part of the basic design of the iPhone 4's antenna that you can affect its reception in this way, but that doesn't translate into saying that it's a bad design. Like the antenna design in every other cell phone, the iPhone 4 design is a compromise. The engineers who designed it had to choose between an efficient antenna that would overcome some of the reception problems that had spurred earlier complaints and some worse reception problems that currently plague other smartphones.
In most wireless devices these days, the antenna is printed on the main circuit board, or one that's situated next to it. It looks like a copper zig-zag design, and it's usually under the keyboard or the battery, although there are many places where the designers place them in the interests of looks, convenience or sometimes efficiency.