AT&T green-lights SlingPlayer on iPhone

It has taken almost a year, but on Thursday AT&T said it will start allowing Sling Media's SlingPlayer to work over its 3G network on the iPhone.

SlingPlayer, which redirects TV signals from a home TV over the Internet so it can be viewed on a portable device, like cell phones or laptops, is the latest application that AT&T is making available to iPhone users on its 3G network. In October, it said that it would allow voice over IP services, such as Skype, to operate on the iPhone using the 3G network. Previously, these applications could only be used over Wi-Fi connections.

Skype officials say they are still working out the kinks on their iPhone app, but that it should be available soon.

AT&T has been criticized for blocking these applications and others from its network. Critics have complained that the company has been picking and choosing which applications can be used on its wireless network in an effort to stifle competition or control the market. Consumer groups as well as Sling Media, Skype, and Google, which is trying to get its Google Voice application in the Apple App Store, have filed comments with the Federal Communications Commission.

AT&T has argued that it's simply protecting its wireless network. Streaming video applications, such as SlingPlayer, consume a lot of bandwidth. And the company says it must ensure the quality of service for all its customers.

But now it looks as though AT&T has had a change of heart--at least for some of these applications. An AT&T spokesman said it is changing its stance on these applications because it's motivated to 'bring customers the widest possible array of mobile applications." Specifically, the company's top wireless executive said the change was a result of working closely with Sling Media to adapt the application to work more efficiently on the 3G network.

"The key for us is Sling Media was willing to work with us to revise the app to make it more bandwidth sensitive, "Ralph de la Vega, president and CEO, AT&T Mobility and Consumer Markets, said in a statement. "They made important changes to more efficiently use 3G network bandwidth and conserve wireless spectrum so that we were able to support the app on our 3G mobile broadband network."

But the timing of the announcement is interesting, since Sling said last year that it had already made changes to its application and was willing to make more changes to make it work more harmoniously on AT&T's network. In May, after Sling was told the application could only operate via a Wi-Fi connection, David Eyler, a project manager for Sling Media told CNET that the latest version of the SlingPlayer submitted to Apple for the App Store had used technology that would cap the bit rate to ensure it was below Apple's and AT&T's threshold.

Other Sling insiders have explained that the technology was developed to adapt to changing conditions on the network to ensure a clear picture and sound. For example, when the network is congested, the Sling technology automatically adjusts the bit rate at which the video is being streamed. When more bandwidth is available, it readjusts this rate.

Adapting the technology to limit transmissions to a certain bit rate, even there is enough capacity to support a bit rate, is not a difficult change to make, one Sling insider, who didn't want to be named, said. In fact, he said it could be easily changed and tested within a week.

So why did it take AT&T six months of collaboration with Sling Media to work out the kinks? Perhaps, technical issues weren't the problem. Maybe, AT&T's willingness to change its stance was motivated more by politics than technology.

Last month, the FCC closed public comments on new regulation it is drafting to keep the Internet open. These Net neutrality regulations are controversial and AT&T and other companies have fought against them. One major sticking point for AT&T and other wireless companies is that they don't believe that open Internet rules should apply to wireless networks. AT&T's critics have specifically singled out AT&T's ban of the SlingPlayer as a reason why new Net neutrality regulations and laws are necessary.

FCC Chairman Julius Genachowski has been advocating, since he proposed the new regulation last fall, that the rules should apply to all Internet service providers, regardless of whether it provides wireless access or access using a fiber or cable.

AT&T's concerns for its network are legitimate. It's true that streaming video eats up a lot of bandwidth. Because cellular networks are divided into cells, users in a particular cell share the available bandwidth in that cell or region. This means that streaming a lot of high-quality video over the network could potentially eat up all the available bandwidth and degrade service for other subscribers in that cell.

And up until recently, AT&T's network may not have been prepared to handle the demands of streaming services, such as Sling Media. AT&T has acknowledged that demand for data driven by the iPhone and other 3G smartphones has affected its network. And the company has been upgrading its network to handle the growing demand. During its fourth quarter conference call last week, it outlined steps it's already taken to add capacity, and it offered insight into future upgrades.

But AT&T has not been consistent in its policies. While it blocked SlingPlayer, it allowed other applications from partners, such as Major League Baseball to stream live baseball games. It also blocked other applications that are not bandwidth intensive. The ban on VoIP services was clearly not related to capacity concerns since voice traffic does not require large amounts of bandwidth. What's more, AT&T had allowed some VoIP services to operate on some phones, while it prohibited them from operating on others, like the iPhone.

Google Voice is another application that is not offered on AT&T's network for the iPhone, and it would not require much of AT&T's network resources. And even though Google Voice doesn't appear to threaten AT&T's business directly, it touches AT&T's core voice business. Google Voice allows incoming calls to ring mobile phones, office phones, or desk phones depending on how the user sets their Google Voice profile. It also treats voice mail like e-mail, transcribing voice messages into an in-box where they can be read and deleted.

Last year Google submitted a native version of Google Voice to Apple in hopes of getting in the App Store. Google said its application had been rejected. Apple denied it had rejected the application. AT&T said it did not reject the application. Since the FCC stepped in this summer, Apple has said it's reviewing the application. In any case, Google Voice remains in App Store limbo.

Google has taken matters into its own hands, and it's now offering the service through a browser on iPhones running the latest operating system.

Regardless of what is motivating AT&T to open its network to more applications, consumers come out the winners, as they finally get access to more cool applications.

Update, 12:20 p.m. PDT: Analysis added.