AT&T: The iPhone's anchor

Backstage at the keynote event that kicked off Apple's Worldwide Developer's Conference today, there were likely some smiles from Apple execs as the audience chuckled at the little jabs against Microsoft - you know, comments that poked fun at Windows Vista, for example, and others that pointed out that Windows 7 is just a new face on the same crappy technology.

But I'd be willing to bet that Apple execs watching from afar were not very happy to hear roars - yes, roars - of laughter coming from the auditorium every time AT&T was mentioned and even when it should have been mentioned, but wasn't.

In all honesty, it was awkwardly embarrassing for the company, which was trying to focus on the iPhone 3G S (Techmeme, Apple statement). I know I was embarrassed for them - especially as the folks who were presenting did their best to keep moving on the script while the laughter was clearly keeping people from paying attention.

Apple can put executives and partners on stage to demonstrate all of the cool things that you can do with an iPhone. And you can't take that away from them the fact that they've made a device that is changing the world. But there's nothing they can do about the fact that the iPhone service over the AT&T network is considered to be the worst in the nation.

Previous coverage: AT&T’s 3G upgrade: It’s about time but is it too late?

Seriously, I hope that Tim Cook and team, as well as Steve Jobs, picked up on the fact that the Apple faithful aren't laughing with them. They're laughing at them for sticking by that ridiculous exclusive AT&T partnership. Here's a recap of a few of those moments:

• MMS: iPhone users have been begging for the ability to send and receive picture and video messages the same way they receive text messages. And now, here it is. But MMS requires carrier support and Apple is proud to say that 29 carrier partners in 76 countries - whose corporate logos were displayed on the big screen - are ready to go. Then, in almost a bit of a whisper and certainly more of an after-thought, it was mentioned that AT&T would support MMS in the U.S. later this summer. Immediately, the crowd erupted in laughter.
• Tethering: The ability to use a phone's Internet to power the browser on a computer - either via USB or Bluetooth - is a huge selling point, especially for business users who rely on air cards from their wireless companies to power the browser on a computer. Apple played it straight, noting that carrier support was required and that 22 carrier partners were ready to deploy. Those logos appeared on the screen again but this time there was no after-thought mention of AT&T. (Does that mean tethering support isn't coming at all?) Of course, that didn't stop another eruption of laughter.
• iPhone 3G S: The "S" in the name of Apple's newest iPhones is supposed to stand for "Speed" but if it's dependent at all on the AT&T network to showcase what it can really do, the "S" may end up standing for "slow" instead.
• iTunes downloads: Another announcement spoke of the ability to download movies and TV shows from the iTunes Store on the iPhone. The example: you're waiting to board a flight and want to download a movie to watch on the plane. You know where this is going, right? Exactly, you'd better hope that you're doing that download over a WiFi connection in the terminal because I can't even begin to imagine what the experience would be like if you were trying to download a movie over the AT&T connection.

And so I say - once again - that AT&T is holding Apple back when it comes to massive adoption in the United States. There are people - myself included - who would buy an iPhone today if it were available on another carrier. And now that the standard device is priced as low as $99, it's almost a no-brainer of a purchase - but I still wouldn't do it.

I realize that Apple probably had more bargaining power and was able to maintain control over the direction the device would take when it decided to move forward on an exclusive deal with AT&T. Today, that exclusive deal is the anchor that's keeping the Apple and the iPhone from showing its true potential at redefining the mobile phone, smartphone and even handheld computer spaces.

Also see: Gallery: Live from Apple's WWDC