Sling Media’s Slingbox is an intriguing device that allows you to view your cable TV or recorded PVR content on-the-go via transmission from an internet-connected home PC.  The technology was made even sweeter when 3G streaming SlingPlayer Mobile was unveiled for smartphones. 

However, just as good times seemed at hand for iPhone users, the service's 3G streaming capabilities were unexpectedly absent in the $30 app that hit Apple's App Store this week.  It turns out AT&T cut off the 3G streaming citing that its HSPA network likely could not handle the strain.

AT&T issued a statement, describing, "Slingbox, which would use large amounts of wireless network capacity, could create congestion and potentially prevent other customers from using the network. The application does not run on our 3G wireless network. Applications like this, which redirect a TV signal to a personal computer, are specifically prohibited under our terms of service."

However, the strange part comes in its following statements, and the fact that it is still allowing 3G streaming on BlackBerry, S60, Windows Mobile, and Palm phones.  AT&T’s reasoning is that the iPhone is a PC.  It states, "We consider smartphones like the iPhone to be personal computers in that they have the same hardware and software attributes as PCs."

While the ban will likely incense iPhone users, it also does not solve the key dilemma -- how to cope with video streaming.  AT&T writes, "That said, we don't restrict users from going to a Web site that lets them view videos. But what our terms and conditions prohibit is the transferring, or slinging, of a TV signal to their personal computer or smartphone."

Sites like Hulu, YouTube, or AOL Video will likely pose a similar threat to the network.  With growing adoption of smart phones, similar problems are likely to crop up, due to the demands of streaming video.

For now, SlingPlayer on the iPhone will only work over Wi-Fi.  Writes AT&T, "The Slingbox application for the iPhone runs on Wi-Fi. That's good news for AT&T's iPhone 3G customers, who get free Wi-Fi access at our 20,000 owned and operated hot spots in the U.S., including Starbucks, McDonalds, Barnes & Noble, hotels, and airports. AT&T is the industry leader in Wi-Fi."