AT&T was the first and remains the sole carrier of Apple's iPhone in the U.S. With millions of new iPhone customers, the deal has been a win for both companies. It has defined Apple as a dominant player in the smart phone market and catapulted AT&T into second place in terms of U.S. subscribers, behind only Verizon.
However, the relationship between the pair has gone from hot to cool to downright icy. At Apple's Worldwide Developer Conference, where the new iPhone 3G S was introduced, this rift appears especially pronounced.
At one point in the keynote address, Apple showcased a large list of the telecoms internationally which supported using tethering to make the iPhone a modem. AT&T was not on the list. Some in the audience gasped at the glaring snub to AT&T.
Later in the keynote, the presenter matter-of-factly mentioned that AT&T won't support sending photos as SMS messages until later this summer. Right on cue, many Apple-philes in the crowd began to loudly boo.
Such disdain has long been simmering. Many iPhone customers have sounded off on DailyTech and other sites complaining about AT&T and longing for official alternatives (outside of unlocking).
In a way the two companies are well suited for each other. Both have proven themselves willing to resort to extreme tactics to control user actions and what content they are allowed. However, Apple has grown increasingly tired of being blamed for problems it feels are AT&T's fault, and AT&T is equally tired of being blamed for problems it feels are the responsibility of Apple.
Reports indicate that Verizon could pick up the iPhone in the U.S. as soon as next year. No one knows the secret details of Apple and AT&T's contract, but it seems unlikely that the company will be able to hold onto exclusivity -- or want to. This could be bad news for AT&T as Verizon has a larger network and better coverage (though occasionally criticized for its data network) and many users would likely switch. Most would argue its good news for Apple, which will sell more phones, and the customers, who should see better service.