AT&T offers more tethering data to one-up Verizon

by Phil Hornshaw

Just before Verizon (VZ) started accepting preorders of the iPhone 4 on its network, AT&T (T) kicked off a new offer of its own: an additional 2GB of data per month for tethering devices to the iPhone.

The change comes just in time to counter one of the big, defining features of the new Verizon iPhone -- support for turning an iPhone into a mobile Wi-Fi hotspot that can support up to five other devices, care of Verizon’s HotSync service. The mobile hotspot service isn’t free, however: Verizon is offering it for $20 per month, which comes with 2GB of data coverage to use with your connected devices. That’s on top of its $29.99 per month unlimited data plan that just covers the phone.

AT&T’s additional data offering boosts its offer to 4GB for tethering, compared to 2GB for tethering from Verizon, according to Mashable. Up until today, Verizon’s plan was comparable to AT&T’s -- the latter company has been charging $20 for 2GB with tethering since tethering became available. Obviously, AT&T is hoping the boost will set it apart from Verizon, which stands to pull a whole lot of customers away from the network.

Of course, AT&T isn’t saying that; it is also releasing an app for phones running Google’s (GOOG) Android operating system called AT&T Mobile Hotspot, which will only be available on the HTC (2498.TW) Inspire 4G at first, but other devices will be able to use it not long after that. And while it’s limited in who will have access to it at first, AT&T’s new app does exactly what Verizon is doing with the iPhone. The change in the data plan is meant to support the new app, according to AT&T -- it’s just that the timing is lucky, I guess.

What’s interesting is that AT&T isn’t rolling out a hotspot app for the iPhone, a move it has mentioned making. The service isn’t exclusive to Verizon, and is actually supported in the next iOS update. One would think that if AT&T has the ability to counter Verizon’s capabilities exactly, it would do so.

So perhaps AT&T can’t do it yet. Perhaps Apple (AAPL) is holding the company back at the moment in favor of its Verizon launch, hoping to sell more iPhones for the function before it comes out that all the phones will be mobile hotspot-capable. Or maybe AT&T doesn’t have the app built yet. Maybe it’s holding back for the next iOS update -- although that hasn’t stopped Verizon from talking about HotSync.

What’s holding AT&T back? It’s tough to say, but it doesn’t seem likely that AT&T would willingly hold off on an iPhone hotspot app if it had one, even at Apple’s behest, since it could be another stopgap against a potentially massive exodus of its customers. It seems much more likely that AT&T doesn’t have such an app, or isn’t planning to support one. Given the potential additional data drain on its already taxed network, it might be the case that while AT&T will give another 2GB per month to its tethering customers, it really doesn’t want to create a whole lot more of them.

That, or either AT&T doesn’t think the mobile hotspot will sell iPhones, or it isn’t ready. Both are possible, and the latter is the simplest and probably most likely. If that’s the case, then surely AT&T is scrambling to get an app ready that will counter Verizon. Those of us not jumping ship could very well have another great iPhone function on the way to us, with another 2GB of monthly data usage besides.

The problem is that finding out just what AT&T does or does not have planned means waiting to see -- and lots of AT&T iPhone owners may not be willing to make that commitment with a shiny new company, plan and hotspot feature in sight.