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iPhone Roundup: AT&T Wi-Fi, Out of Stock, International Carriers

We at TidBITS try to avoid obsessing about the iPhone – there are plenty of other media outlets that already do that. But a number of recent events are worth summarizing for what they indicate about both the current utility of the iPhone and its future in the United States and worldwide.

Wi-Fi: It’s Up, It’s Down, It’s All Around Confusing — AT&T toyed with its customers’ affections these last two weeks by offering a peek into what it plans to provide in the way of free Wi-Fi to iPhone subscribers on its aggregated hotspot network. AT&T scored a deal in February 2008 to take over Starbucks’ Wi-Fi network from T-Mobile (see “Starbucks Deal Brewed with AT&T Has Hints of Apple,” 2008-02-12), and began converting locations starting with AT&T’s headquarters city of San Antonio, Texas, a few weeks ago. They’re expected to be complete across all 7,000 Starbucks company-owned freestanding outlets in 2008.

But eagle-eyed Wi-Fi users spotted a new network name – “attwifi” – at Starbucks stores at the same time as on the T-Mobile network – “tmobile” – a square link appeared in the upper right corner of their gateway page welcoming AT&T customers. That wasn’t unexpected or odd. However, a MacRumors reader seems to have been the first to document when on 30-Apr-08 an iPhone-customized gateway login page appeared that asked for a subscriber’s phone number to gain free access.

A few days later, that gateway page went away. On 07-May-08, MacRumors again was apparently first with the news that AT&T’s iPhone plans page had been updated to note that an iPhone included free access to 17,000 U.S. hotspots available through AT&T. Two days later, that text was gone. AT&T told Fortune’s Philip Elmer-DeWitt that it was all human error, but they planned ultimately to provide free Wi-Fi to iPhone users, as has been expected all along.

(Seven million AT&T residential customers – anyone with DSL that’s 1.5 Mbps downstream or faster or their fiber service – already get free access to AT&T Wi-Fi Home, a set of 17,000 U.S. hotspots that includes 9,500 McDonald’s locations and 7,000 Starbucks – in progress – but excludes most hotels and some airports that are found in AT&T’s broader Premier roaming package. Premier service includes all U.S. hotspots and 53,000 international locations, and costs $10 more per month for those who qualify for free service, and $20 per month for everyone else.)

AT&T Wi-Fi will clearly ultimately be available and free to iPhone users, but it’s vaguely incomprehensible why AT&T has muffed this whole Starbucks transition and not simply offered the network already. It’s part of a long-term loyalty play by the company to retain its subscribers, and would improve your iPhone experience by giving you faster Wi-Fi based access when you need it at no additional cost.

iPhone 2.0, iPhone SDK, 3G iPhone, and No iPhones to Purchase — It’s 10-May-08 as I write this, and there are no iPhones to be had via the online Apple Store in the United States nor via O2, Apple’s UK partner. That’s plain weird. Apple has said that it plans to release its revised iPhone 2.0 firmware along with a release version of the iPhone SDK (software developers kit) in June 2008, most likely at the Worldwide Developers Conference (WWDC) (see “Apple Announces iPhone 2.0, Releases SDK,” 2008-03-06).

This is when everyone anticipates the expected third-generation (3G) iPhone, one that uses AT&T’s faster HSPA (high speed packet access) network, will be announced or released. The HSPA network has speeds AT&T reports as an average range of 600 Kbps to 1.4 Mbps downstream versus the current 2.5G iPhone’s 100 to 200 Kbps downstream rate.

So it’s quite peculiar that Apple and its partners should happen to run out of stock now. Would this argue that a 3G iPhone is ready to go, and we’ll see a surprise announcement this next week? Hard to say. I can’t quite believe Apple would give up a full four weeks’ sales just to avoid making more phones in the interim. As usual, they give no indications, and we’ll just have to wait and see.

Expanded Carrier Relationships in Europe, Latin America, Asia/Pacific — Even as the iPhone seems to be in scant supply in the United States and the UK, Apple has inked deals with carriers for broader relationships. Vodafone, which owns a minority percentage of AT&T competitor Verizon Wireless, will sell the iPhone starting later this year in territories that encompass several billion people: Australia, the Czech Republic, Egypt, Greece, India, Portugal, New Zealand, South Africa, and Turkey. Apple will let both Vodafone and Telecom Italia offer the iPhone in Italy, and SingTel (via subsidiaries and affiliates) will distribute the iPhone in Australia, Singapore, India, and the Philippines. This marks a move away from Apple’s previous single-provider approach, since Italy, India, and Australia will be served by multiple carriers.

To the west, America Movil SAB will sell the iPhone to customers across Mexico and 15 other Latin American countries as well as Puerto Rico. The firm has 37 percent of the market in its territory.

Apple seems well on its way to meeting its target of a cumulative 10 million phones from the device’s first sales until to the end of 2008. In fact, Apple seems to think its biggest problem is that there’s so much pent-up demand for the iPhone that perhaps as many as half of the iPhones sold have been purchased unlocked or later cracked to allow their use in countries that don’t yet have a domestic carrier offering the phone. Apple’s chief operating officer Tim Cook said in April 2008, “We see this phenomenon as an expression of very strong interest in the iPhone globally, and in that way it’s a good problem to have.”

iPhone Forever — Sequels sometimes suck, but iPhone 2.0 and the 3G iPhone – which may arrive together or nearly so – will likely improve and extend the product. I’ve owned an iPhone since the night Apple unleashed them on the world, and while it’s by no means perfect, it has the lowest frustration to enjoyment ratio of nearly any electronic product I’ve ever owned, and is at a fair approximation 100 times better than any cell phone I’ve owned or tested. Bring on the next release!

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