Interesting that you should mention texting. I had SMS on my last four phones including my first generation iPhone. I can tell you the exact number of text messages that I’ve sent and received during my entire lifetime because that number is zero. I was delighted with AT&T allowed me to opt out of texting with the 3G upgrade. I use email constantly but have never seen a need for texting and think it is ridiculous for them to charge $$ for those little messages.

The takeaway is that AT&T’s network is likely seeing the majority of ALL data traffic on all networks. So it’s not clear how you can actually compare network quality without similar traffic on each network.

And also AT&T is not likely making more money off of each iPhone customer – if they were a BlackBerry customer, they’d have to pay the same data rate, but would use far less actual data bandwidth. Thus they are a better customer for AT&T. Now, that’s not to say that AT&T didn’t get many more data customers by having the iPhone than they would have otherwise. But the network cost per added iPhone user is way way higher than for anyone else. One has to wonder if they really took that into account in their build-out plans pre-iPhone. I suspect not.

It’s the “occasional” use that I think the telcos need to price for.

Here in the UK O2 are offering tethering for an additional monthly charge. But I’m not likely to want to use it very often, so I would not make use of the service if I had to pay a monthly fee.

A competitor telco (T-Mobile UK) has a low-cost data service (with a USB-stick modem) which you pay a per-day fee for any day you use it. Now if tethering were priced like that that I’d make use of it.

As I understand it, when you get an iPhone on AT&T your data use is unlimited… so if the actual use per customer goes up massively, it is AT&T’s loss in having to provide that for no extra revenue.

I’m not saying it’s good for AT&T not to support features that the iPhone provides, but discredit where it’s due: other providers stand to make huge amounts of extra revenue by allowing tethering, while AT&T does not.

Two, when the exclusive deal is up, I really doubt Apple will sign another exclusive contract, with all the trouble the AT&T has brought (though, to be fair, it’s made all involved a lot of money). I’m sure they’ll make a CDMA version (how hard can it be to swap out a radio chip set and have two kinds of firmware… the OS won’t care) and let’s not forget that South Korea also uses CDMA, so that combined with Verizon’s huge user base is a lot of extra users… certainly worth the investment.

Three, I think AT&T really needs to step up their game and show themselves to be worth of iPhone customer’s loyalty, because the first 2 years have been waiting at the exits. If they get their 7.2Mbps 3.5G net going quick and reliable, and create reasonable tethering plans, they have a shot at retention.

It also means that Apple could release one iPhone and have it work on all of the GSM-compatible networks. Seems like a win-win for Apple.

You seem to have this situation backwards. The primary technical reason to stick with AT&T is that they are the largest GSM provider in the US, meaning they can use exactly the same hardware everywhere in the world *and* get some nice exclusivity kickbacks. A Verizon iPhone would mean engineering a CDMA model of the iPhone solely for Verizon alone and then producing a second model for everywhere else in the world. And each of those is multiplied by the number of different models, an issue compounded if they ever release alternate models (iPhone mini let’s say). It’s not completely out of the realm of possibility, but historically Apple has gone to great lengths to streamline its product lineup (i.e. the laptop update), so they’d have to be pretty desperate to go that route.

That being said, they doesn’t mean they can’t (and shouldn’t) use the possibility as leverage against AT&T.

You make a good point that AT&T’s network is hit harder than other companies’. Don’t put the iPod Touch’s numbers in there, though, since it only surfs on WiFi, not on AT&T’s network.

Is there any reason to believe that Verizon’s network is/would be better than AT&T’s if it had to deal with the data usage of millions of iPhones? It seems unlikely that they have 4x or 5x excess capacity just siting around. I’m sure someone who had the time could crunch the numbers more explicitly, but it seems to me an interesting question.

This is the epitome of foolishness. Just as they gained millions of customers with the announcement of the various iPhones in the past, they will lose them the moment there is a competition for those customers.

Fear never leads to success. Monitor your network, degrade performance smoothly if it’s over used. And give your customers what they want. It’s really not that hard.

ssh
http://twitter.com/shultquist

It’s a bit hard to configure but it’s OK once you get it working.

Even though I’ve had tethering on the iPhone for some time I haven’t used it very much. I think that will prove to be the norm. It’s a life saver when you need it but you don’t need it very often.

I’ve used it a few times when Comcast cable service had technical problems and my WiFi connection went down. Also a couple times at a hotel when I didn’t want to pay the $15 per day Internet connection charge for relatively brief sessions online.

I don’t see iPhone owners using tethering very much. That would be even more true if AT&T decides to charge extra for it (I don’t think they should. I’m already paying them for a data plan and hitting me again for tethering would be double dipping).

Though tethering works it isn’t nearly as speedy as WiFi. And it sucks down battery life on both the computer and the iPhone. You almost need to put the iPhone on a charger while connected. I see it as nice to have for occasional use but don’t see a lot of hours online with it.

(nice article, JD)

Obviously the info wasn’t going to make AT&T look good. But was there ANY way to avoid that?

Apple simply choose not to withhold or delay the features from the entire world. And then did its best to gloss over AT&T. But an audience of developers was certainly going to notice.

The mobile world outside of the US is quite advanced and competitive. Apple can’t compete globally by withholding features until AT&T is ready.