Gizmodo's leak of the iPhone 4 already made Monday's Apple keynote slightly awkward. But the most uncomfortable moment was when part of Steve Jobs' iPhone 4 demo failed due to Wi-Fi issues.

Watching the video below (shot by IDG), you can almost feel the increasing frustration of the CEO, and you can only imagine what was going on backstage to resolve the problem.

After about a minute of troubleshooting – and a failed attempt to connect to AT&T's 3G network instead – Jobs explained that over 500 Wi-Fi devices were being used in the crowd, likely causing interference with his demo unit. He even asked bloggers to stop doing their jobs for the sake of the demo.

"All you bloggers need to turn off your base stations," Jobs said. "If you want to see the demos, shut off your laptops, turn off all these MiFi base stations and put them on the floor, please."

At one point Jobs asked Scott Forstall, vice president of iPhone (now "iOS") software, if he had any suggestions, and someone in the crowd shouted "Verizon!"

Google also ran into similar network problems that stalled its demonstration of Google TV last month. In Apple's case, Jobs was referring to users of Verizon's MiFi, a device that creates a portable hot spot that can be shared by up to 5 users. Some smartphones, such as the Palm Pre and some modified Android phones, are also capable of serving as a hot spot. The iPhone currently permits tethering (a one-to-one connection with a laptop) but AT&T has not permitted that service for its customers, and the iPhone can only act as a hot spot if it has been jailbroken.

With over 500 Wi-Fi hot spots in a room of 5,000 people, it's a sign of how popular hot-spot–sharing devices or features have become.

To be fair, if Verizon were the iPhone's carrier, it would likely suffer from the same issues as AT&T. But the problem of an overloaded cellular network would be mitigated if the iPhone were available on multiple carriers as opposed to just one. During his glitchy keynote, Jobs was probably feeling our wireless woes more than any other day.

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Photo: Jon Snyder/Wired.com