DIAGNOSIS: That's the Arc trying and failing to connect to your Wi-Fi network during setup. It's almost always a network handshake issue, not a hardware problem.
FIX: First, hardwire it. Grab an Ethernet cable and connect the Arc directly to your router. Open the Sonos app, it should detect the wired speaker. Complete setup there. Once it's fully set up and playing audio, you can unplug the Ethernet cable—it'll usually hop onto Wi-Fi just fine after that initial wired handshake.
IF THAT DIDN'T WORK: If you don't have a free Ethernet port or it's too far, you might be dealing with a congested Wi-Fi channel. Temporarily disable the 5GHz band on your router, force your phone and the Arc to connect to the 2.4GHz network for setup, then re-enable 5GHz afterward.
HEADS UP: The Arc really doesn't like being set up on a shared guest network or a network with aggressive AP isolation. Make sure you're on the main network.