Bottom of iPhone Losing Sensitivity To Touch

I have noticed that when I try to access the bottom part of the iPhone, that the phone doesn't respond. I tried adding a new contact, and then pressed the sapce bar, and nothing happens. This also happens while in the phone mode, trying to press the icons "contact", "keypad", "vociemails", I notice the phone not responding. Is there an issue with the phone losing its sensitivity to touch? Is this a flaw? Is there a way to resolve this? I don't understand why it's doing this now. Maybe there is an update to fix this? Or maybe it's an actual hardware issue? I bought this phone in November of 2007, so does that mean it's still under warranty?