David Braue07 December 2009, 8:44 PM
Nearly five months after Apple first launched iPhone tethering, the big telco has switched on the feature for customers, blaming Apple for the delay.
The telco giant has finally followed its competitors’ lead by enabling tethering in a move that could cut into the carrier’s own hugely successful wireless broadband business.
The change of policy came after the release of carrier update 5.1 on Saturday provided Telstra’s iPhone customers with the correct settings to enable tethering – the use of a smartphone as a modem for linking to a conventional computer. Some users had managed to enable tethering in the past by using a modified carrier files, but this capability had been subsequently blocked.
Telstra initially said the ban was due to a prohibition by Apple, but Apple said that it had imposed no such restrictions and that Telstra, like other carriers, was free to offer tethering according to its own policies.
Today, Telstra spokesman Peter Habib elaborated slightly to APC, saying "access to the tethering function on iPhones is controlled by Apple. This capability is normally activated through iTunes, however Apple disabled this on iPhones supplied to Telstra," though that doesn't exclude the possibility that the phones were supplied in this state at the request of the now-departed former Telstra management team.
The iPhone has had a chequered history at Telstra, which introduced the iPhone 3G last year but has not kept the platform at feature parity with its other offered smartphones. For example, Telstra excluded the handset – which, with its large 3.5-inch screen, is held to be ideal for watching videos – from its mobile coverage of last year’s Beijing Olympic Games. And it was not until October that Telstra introduced the ability for iPhone users to access Mobile FOXTEL, its nearly three-year-old service for delivering FOXTEL pay-TV content over Telstra Next-G network.
Similarly, tethering over the Telstra network has been possible for years using a range of other phones. The decision to finally bring the iPhone’s tethering capabilities in line with those of other devices was, unsurprisingly, a hot topic amongst Telstra customers on sites such as MacTalk, Australian Macworld, and Whirlpool.
Speculation about the reasons Telstra waited so long to offer tethering has been rampant, and certainly, one effect the new policy is likely to have will be seen in the effect of tethering on Telstra’s standalone business selling ‘dongles’ – which provide Internet access over Telstra’s Next-G network by plugging into a laptop’s USB port. However, it's hard to imagine that the money in dongles was the restraining factor for Telstra, since they're sold pretty cheaply, and Telstra really makes its money on the monthly data plan fee -- which you still have to pay if you're an iPhone tetherer.
That business has proved remarkably profitable for Telstra, which saw revenues from wireless broadband services jump 69.2% to $587 million between the 2008 and 2009 financial years. That corresponded to a jump in subscriber numbers from 526,000 to over 1 million during the same time period, although it is not known how many of these subscribers are iPhone users whose wireless broadband dongles are now redundant.
There is no extra charge for iPhone tethering, following accepted practice in the industry. Optus initially proposed a monthly charge for tethering iPhone customers, but backed away from the charge after widespread protest, as long as a customer takes up a mobile data plan that is on top of their iPhone plan's included data cap.
Although it has relented with regards to iPhone tethering, Telstra has warned customers to be careful about the capability’s effect on their broadband usage: tethered downloads are counted towards the user’s browsing pack data limit, and exceeding that limit can quickly incur tens or hundreds of dollars’ worth of extra usage charges.
Are you tethering your iPhone on Telstra? Will this change make your wireless broadband service redundant? Do you believe Telstra when it blames Apple for the delay in getting tethering going?