AT&T Finally Brings Tethering to the iPhone: What you should know…

One of my main AT&T/iPhone complaints has finally been addressed. Ever since the iPhone 3G (and for some, the original iPhone) came out two years ago, I wondered why AT&T was so adamant about NOT allowing you to tether (use your iPhone as a modem/WiFi hotspot) your iPhone to your laptop and share its 3G data connection. After all they allow this with every other smart phone they sell and they even sell 3G data cards. Also no one ever expected this to be FREE. So I never really got why this was such a big deal? Granted AT&T couldn't do it alone and it would require built-in support by Apple in the iPhone OS (iOS). However, that support came in iPhone OS 3 LAST YEAR. So what took AT&T a YEAR to allow it on the iPhone for us in the US? They claim that they still needed to tweak their network to allow the influx of additional data traffic. While this may be true, the thing is since it's not FREE, not everyone is going to do it. Also it's not something you're going to be using all the time or would you?


Data Plan caps may have been the real issue

I don't doubt that AT&T needed to (and still needs to) work on "the world's fastest 3G network" to get it ready for even the slightest increase in traffic, but I suspect that an even larger issue was not wanting you to be able to pay a flat fee and have unlimited use. Even when you go with a $60/month 3G data card from AT&T there is a 5GB/month cap on it. Up until now all iPhone plans have been "UNLIMITED" data. So while the amount of 3G data that iPhone users currently consume must be HUGE, I'm sure giving users unlimited tethering would have brought this fragile network to its knees.


Do you want unlimited iPhone 3G data or do you want tethering?

I ask this because you can't have both! Not only did AT&T recently change their Data Plans for any new users, but in bringing out iPhone tethering it also requires you to be on the NEW DataPro plan. Here's how it works: If you upgraded from a previous iPhone to the iPhone 4 or you are still on an iPhone 3G/3GS, AT&T grandfathered your current "unlimited data" plan in. Yep, you can keep your "unlimited data" plan at the same price ($30/month) and have a nice day. However, if you want iPhone tethering (which requires iOS 4), then you HAVE TO switch to the NEW DataPro plan, which has a 2GB/month cap for $25/month plus pay the $20/month for tethering ($45/month total). Now that may be a good deal for the casual user. You get to tether your laptop in those situations when you're out and about and WiFi is unavailable or cost prohibitive. It will only cost you $15/month more than what you're paying now and if you're on WiFi most of the time anyway, you may never hit the 2GB cap in a month. Also it's cheaper than going with a $60/month 3G data card on top of the $30/month you're already paying for your iPhone data plan. However, if you're the video streaming, app downloading, news reading, VNC remote controlling, multitasking, data junkie that I know many of you are, this could get expensive pretty quick. Once you hit the 2GB cap in a month it will cost you $10 more per 1GB increment after that. So let's say you use 5GB in a month (which is not a stretch for many). It would cost you $75 that month for your iPhone data ($25), tethering ($20) and your 3G overage (1GBx3=$30). That's not too bad considering that it's still cheaper than a $30/month plan for iPhone unlimited data plus a $60/month plan for a 3G card. Keeping in mind that there would be no limit on the iPhone 3G data used if you kept your old plan. 


How much iPhone data am I using?

Not having to worry about it in the past, I never kept tabs on my usage. However, now that I have an iPhone 4 (new line) and the tethering option (which I may not keep. It's for testing right now), I'm going to be keeping an eye on it for sure. You can see your current usage by dialing *3282# from your iPhone and you'll receive a text message back with your current usage. 


It could be better with WiFi instead of just USB/Bluetooth

The current implementation of Tethering on the iPhone is actually kind of a step backwards. Apple built-in "tethering" into iPhone OS 3 and iOS 4 that basically turns your iPhone into a "modem". So if you have a computer that can connect to it via USB or Bluetooth you can use this connection to get on the internet. Even the word "modem" feels old. By taking this approach tethering only works on a limited number of devices, like, um computers 🙂 So even Apple's fancy new iPad WiFi model can't use this connection because Apple hasn't built in tethering support for it. One of the things I suggested two years ago was to allow the iPhone to become a WiFi hotspot (similar to a MiFi). There was even a 3rd party app called Netshare, that got pulled almost as quickly as it was released. Netshare allowed you to do this. If Apple would add a 3rd option besides USB and Bluetooth and allow the iPhone to become a WiFi hotspot, then any WiFi enabled device you owned could connect and use this connection. AT&T says "they don't care. It's up to Apple to allow the iPad to tether." So since there is now a 2GB cap, why should it matter how you use it? Why is this limited to just computers? Other, lesser phones can do this today 🙂


UPDATE: The Speed Test Results Are In

I know many of you are wondering what the speeds would be like if you did go with the Tethering option. So I just ran a quick test to do a little comparing. I ran the tests back to back against the same Chicago server at my favorite speed testing site. Before running each test I turned off the other services. For example, during the Bluetooth tethering test WiFi was OFF.  I also threw in a couple of other tests so that you have other technologies to compare this to.

First up, this is my Comcast Cable service tested over WiFi using an AirPort Extreme Dual Band base station connected to the TrendNet router and New DOCIS 3 Cable Modem:

Next up is my MiFi Wireless Hotspot device with an AT&T SIM Card in it so that we get the same carrier results. Although I can connect to this via USB or WiFi, I only ran a WiFi test since I almost never use it via USB:

Now on to the iPhone 4 with AT&T Tethering. The first test is using a wireless Bluetooth connection (it's not pretty):

Lastly, this test was done with the iPhone connected/tethered via USB (I was stunned by how much faster it was than Bluetooth):

So as you can see, USB will definitely give you the best tethering performance. However, I'd still like to see a WiFi option in ADDITION to Bluetooth and USB, for multiple device sharing.



The Bottom Line

iPhone Data Tethering is LONG OVERDUE! I'm glad it's finally here and for as long as we've had to wait, it could have been better. Maybe in iOS 5 we'll see a MiFiesque type feature. For now you have an option to use tethering if you're willing to give up unlimited data and only use it with a computer. If you're a NEW AT&T customer then it's probably worth the $20/month if you think you'll use it.

It's time (past time) for Apple to open up the iPhone to other carriers here in the US. For all you Verizon loving fans out there, honestly I don't think things would be much better if the iPhone had only been on Verizon either. It's easy to say your network is great and reliable when you don't have MILLIONS of new customers all coming on at once and using up tons of data. I think this is too much for ANY ONE NETWORK. If Apple opened up to Verizon or anyone else right now it would reduce the strain on AT&T and it would make it better for everyone, most of all your customers!

30 Replies to “AT&T Finally Brings Tethering to the iPhone: What you should know…”

    1. Even though i come from ‘No Service’ Area to ‘Service Area’ My Iphone 4 always shows on top saying No Service.. When I switch off and on immediately it will show full signal strength. It happen to me many times.

  1. Thank you Terry. I now have much better understanding of tethering and the Apple – AT&T politics. Loved your last sentence. I have unlimtied but tethering cost would be nice – but too expensive for me. Cheers :-/

  2. You have good points. About not enabling WiFi-tethering troubles me most since you can’t share the internet with iPad on the go, and since there is 2 GB data cap it would not be bad business for AT&T.

  3. Terry:

    Set me straight please. If I have a iphone with teathering it costs $75 and if I have an ipad with data thats another $60 which equals $135 a month (gulp). I live in a hurricane area and have been in the past out of power for three weeks. I need to remain connected if this happen again.

  4. Terry,
    Another great way to keep tabs on your data (that I’ve been using since I got the 2GB Data Pro plan) is the AT&T My Wireless iPhone App. You can keep track of billing and usage right on your phone.

  5. You did mention you were in the process of testing and that is the part I want to hear about. I’ve always wondered what kind of speed you get with teathering (also wi-fi syncing, for that matter)? If it is like a modem, do you get dial-up speeds? If so, I don’t see the advantage unless you are really desperate for a connection all the time. I am waiting for that analysis Terry, as without that I won’t commit to anyone’s phone yet.

    1. You get 3G speeds. Remember “modem” doesn’t just mean dial-up. For example “Cable Modem” and “DSL Modem”. I’ll run a quick speed test and update the post so you can see the results.

  6. I’d like to know how this compares to Verizon MiFi speeds. I am still upset with ATT/Apple’s bait-and-switch on the cancellation of the $30 unlimited, non-contract data plans less than 60-days after purchasing my iPad3G. I planned to use it a few times a year while traveling. I would have gotten WiFi only and stuck with Verizon MiFi if I had known. I really don’t trust anything ATT promotes after that change. I am not updating to the new iPhone either hoping we get carrier choice. I drop phone calls every day and plan to dump ATT as soon as I can. Love the iPhone, but need a phone that can make calls. I will also be interested in your Droid comparison as I may even try that next and switch back to Verizon if ATT doesn’t improve by the time our contracts are up.

  7. I’m sorry, but if you are on a DataPro plan and paying for any extra GB, why should there be any charge (maybe some nominal, say $5 / mo) for tethering? A GB is a GB whether from a browser on the phone or a tethered device. Until someone shows me how tethering costs ATT something I think this is a blatant rip off. Sorta like changing $9.99 to track where your family members are. If they gave you an added download ability, then charging could make sense.


    1. >…I think this is a blatant rip off.

      Actually had the same reaction to your statement when my wife advised me that my 13-year-old had racked up over $200 (over 2,600 text messages!) in one month. Talk about ballistic. After grounding her and confiscating her cell phone, which by the way is more of an inconvenience to us parents, I turned my ire at Verizon. Just how much bandwidth is consumed anyway by a typical teen’s texting? Plus you’re charged sending it and the recipient is charged getting it.

      Sorry for the off-topic rant, but the thread made me revisit it.

    2. This was my reaction as well… The cell carriers are masters at making you pay for something that costs them almost nothing… (You’re already paying for the bandwidth w/ the data plan…) I could see the additional $ for tethering if you were getting additional gigs, but the way it is now, you’re basically paying for the “privilege” of being able to tether… Hey guys — I already paid for that when I bought a phone that was capable of it! (*cough* pdanet *cough*)

      Mikey, ditto there too… Text messages cost the carriers absolutely *zero*… SMS uses extra voice bandwidth… (MMS uses data, so there would be some *very* minimal cost there…) The fees they charge for text works out to be some *huge* outrageous amount if you worked it out on a per-MB basis… We’re talking thousands of $ here… That’s just ridiculous, especially when you’re already paying for a data plan…

      I don’t mind paying for what I use, and even understand they need to make a reasonable profit, but by so drastically overcharging for stuff that costs them nothing — no wonder nobody likes ’em! It’s crazy!

  8. I am so sick of drop calls and no service were I work and live. You would think I lived out in the country. I can’t walk into my building talking on my phone my call is dropped. At work my service goes In and out mostly out. I’m so tired of the same old story about the towers and work being done or just being completed. A new carrier would be very nice.

  9. So why not just keep the MiFi….and tether for free?! 😉 Granted, the SIM card needs to come out but in those rare instances that I need the tether, I have no issue with losing my phone service for a bit….

    AT&T……a shame….

  10. Terry, Is it true that the reason Apple uses AT&T is because much of the rest of the world uses that technology and thats why (here in US) we are stuck with AT&T? I have heard that it would not benefit ($$) Apple to make a phone to run off the system used by Verizon since the US would be the bigger market. Sorces have told me that the date of 2012 may not be even correct.

    1. Partly true: AT&T (and T-Mobile) uses GSM based networks, like the rest of the world. So while Apple wouldn’t have done as well with a CDMA ONLY carrier, I think it’s definitely time to Add a second US based carrier to the mix. Rumor has it to be Verizon in January. So we’ll see.

      1. Rumor does have it and I think you should take credit for it. Who knew they were listening that closely to your Blog? :))) I will switch for sure. I am so glad I didn’t update my iPhone and get the new ATT $350 cancellation fee. It would have been another bait and switch and the iPad 3g unlimited data plan cancellation was enough of one.

        My family will be thrilled to be back on the reliable Verizon network. It will also make Christmas shopping easy.

  11. Thank you Terry for your susinct and honest blog. I had the 3 g card $60/month card and the iPhone unlimited at $30/month. The card was slow and it was a tough To pay $90/month for data. I am elated to have the tethering and the USB option is quite a speed upgrade to the 3G card. However, after my first day of surfing for 4 hours and using my new Data system the exact same way i did with the 3g card, I almost fainted when I went to my I phone “Usage” section in the system folder. It said I had used 4 gb(3.5gb recieved and 509mb sent)

  12. (Continued due to chubby thumbs)…..after I read your piece I dialed *3282# and thank God saw that I had only used 85mb of 2005mb! I don’t know why there was a disparity, but I am glad that AT&T’s counter is a lot kinder to me. Have you noticed this as well? Thanks in advance, John

  13. For me, i had the unlimited data on a card and unlimited on the iphone. After averaging my usage on the card and iphone, i am sure that i will go over the 2GB/month. This writeup helped me decide to make the switch. i will certainly limit my downloading now to what is necessary. Either way, i think it will be better in the long run for me since my data card usage was sporadic.

    The tethering actually connects instantly, much faster than the data card. i think this reason alone is why i am making the switch to tethering.

    The speed tests are relatively the same between the data card and iphone with bluetooth. the iphone actually downloads faster with my iphone. hmm. not taking it too much but i am dropping that card i had for a while.

    Thanks for the write up.

  14. Wht have you heard good or bad about jailbreaking your iphone and using an app called myfi.

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