An allegedly leaked internal document from AT&T refers to tethering the iPhone in what may point to either a data modem capability for the Apple device or else a significant flaw in the iPhone model upgrade process.

The text, which comes from one of Boy Genius Report’s “top informants,” appears to be targeted at customer service agents and repeatedly alludes to the concept of tethering.

Specifically, the document seemingly addresses a flaw discovered in tethering the device to a computer which asks customers upgrading their iPhones to accept a new two-year contract regardless of any existing agreements. AT&T is aware of the problem and will reset the contract’s start date to match what customers originally saw when they first added an iPhone plan.

“Please advise all customers that to complete the tethering process of their new iPhone they will be required to accept a new two-year agreement including the [Terms and Conditions],” the message reads. “However, their agreement will not be extended from their original iPhone activation or upgrade date.”

Employees are also given a script to recite to customers upgrading their iPhones.

AT&T’s exact meaning is unclear. The cellular provider’s references to “tethering” may represent internal phrasing for the initial iTunes activation process and may well refer to customers upgrading to the 16GB iPhone from an existing model rather than any special features.

However, the choice of language is unusual, particularly for speaking with customers more familiar with Apple’s own references to activation and sync. In smartphone terms, “tethering” most frequently refers to using a phone as a substitute Internet connection for a computer when a landline or a cellular modem card is unavailable. The handset typically serves either as the modem itself or as a relay.

Apple has not announced any plans to offer data tethering for the iPhone, though the feature has commonly been requested by some current and potential customers, particularly frequent travelers without reliable sources of Internet access.

If the information simply references the higher-capacity iPhone already on sale, however, it nonetheless indicates a wider problem with transitioning customers to newer iPhone models inside AT&T’s account system. Apple is said to be aware of the issue regardless of its exact nature.

Source: AppleInsider

On Wednesday, AT&T announces plans for a major expansion of the company’s 3G Wireless network to more than 80 additional cities throughout the United States through 2008. The expansion, which will roll out an addition 1,500 cell sites, will serve nearly 350 major markets in the process.

“Other plans for the new year include completion of the nation’s first High Speed Uplink Packet Access (HSUPA)-enabled network by the middle of the year. The AT&T 3G network now delivers typical downlink speeds ranging between 600 and 1,400 Kilobits per second (Kbps), as well as faster uplink speeds, ranging from 500 and 800 Kilobits per second (Kbps). The faster uplink speeds allow AT&T’s HSUPA-enabled laptop users to more quickly send large files and take full advantage of the latest interactive Internet and business applications, said a company representative.

“From the beginning, our wireless network has been designed with the future in mind,” said Ralph de la Vega, president and CEO for AT&T’s wireless unit. “The capabilities of 3G standards will continue to expand over the next several years, enabling us to stay well ahead of our customers’ broadband needs. And looking even further into the future, our existing technologies provide the ideal platform for a smooth transition to next-generation platforms.”

Final prices for 3G service plans have yet to be announced.

Source: iPhoneAlley.com

8GB iPhone owners upgrading their iPhone to the 16GB model should be able to port their original plan along with their SIM card to their new iPhone, but some posters in the Apple Discussions ran into trouble, and were required to open a new 2-year contract.

William Parnes wrote to iPhone Atlas:

“The Apple Store told me I could just plug the new phone in and it would be activated on the old contract. But iTunes and AT&T insist that I have to establish a new contract. I’ve tried both the old and new SIM cards.”

“I called AT&T and was told by rep and then her supervisor that it was not AT&T policy to allow upgrade without a new 2 year contract and that other information on the web and at the Apple Store was incorrect.”

One poster in the Apple Discussions attempted to purchase a 16GB iPhone at an AT&T store had a similar situation:

“I just came from the ATT store where I fully intended to buy the new 16GB iPhone (I have had an 8GB iPhone since day one and have loved it, though I think ATT isn’t the best service provider). However, when the sales agent explained that I would have to re-up for another 2-year committment from ATT, I decided not to buy the new phone — at least at this time. The sales agent said that my original 2-year plan would end the day I activated the new phone and a new 2-year plan would be initiated!”

However, other users were able to upgrade to 16Gb models without any problems, as this poster wrote:

“I went down to AT&T store and bought an 16GB iPhone. To activate it, I had to choose that I was replacing a current phone with this iPhone. I kept the sim in the iPhone that the new 16GB phone came with. Activation was fast and easy and I am still where I was in my contract as I was yesterday, 6 months into the 2 years. The iPhone would not activate with the old sim card in the phone until I put the sim the new phone came with back into the new phone.”

If you try to upgrade, let us know how it works out for you. So far Apple has not offered a formal statement on the situation.

Source: iPhoneAlley

Appleinsider are running a story about a possible reintroduction of the Apple Newton, which was available in the early nineties. 

Is this rumoured product the real smart phone market killer. Why would Apple develop a ‘breakthrough device’ and then muddy the waters with a sooo 90’s PDA category ?

Think about it, all the pieces are there, breakthrough device, iPod touch from factor, iPhone connectivity, and 16gig+ of memory. The only things not there, are the things that you would expect to ship in an old style PDA. Why no spreadsheets for iPhone, or word processor, we all have our particular gripe about what the iPhone ‘could’ have been. Well maybe this is it. 

The phone makers thought they only had to catch up with the iPhone, what if the iPhone is a stalking horse for a real breakthrough device (not that the current iphone is not) which covers laptop computing (touch) no less, an ipod and a communication device.  Not only would the phone makers have to re-focus again, the majority of computer manufacturers have given up on the PDA concept and may well have been caught napping. Leaving Apple to corner the market with another product which fits into its vertical product model, all based on OS X.

Furthermore, based on the functionality and usability of such a device, phone and computer companies would most likely need to form partnerships in an attempt to catch up with and attempt to compete with Apple.

A look at how Apple came to dominate the iPod market may give some clues as to the feasibility of my suggestion. The ipod user experience has two main parts, iTunes music store and iPod device. The combination was a game changer, yet the component parts were launched separately. The reason for this is similar to a Trojan Horse, in that the competition are beaten before they realise they need to respond, only to realise that they have nothing comparable to respond with.

So going back to my ‘all the pieces are there comment’. If this rumour is an ultimate smart phone. The pieces that would need to be in place for it to replicate the iPod success are: Carrier partnerships, already done.  iTouch technology, and great feedback and analysis about its usability and our acceptability of the technology. A market tested mobile OS, which might be just about to raise the bar again. User acceptability of the iPod touch / iphone form factor.

Combine all of these elements into a new product category and you would almost have a iphone / macbook in your pocket, with all those apps we have been looking for on our iPhones.   Here’s hoping J

Hugh