Google confirmed that it pulled a Wi-Fi tethering application from the Android Market because it violated T-Mobile's terms of service, but said it hadn't intended to pull that application from the market entirely.
said his tethering application--designed to let PC or Mac users get on the Internet through their Android phones--was removed entirely from the Android market because T-Mobile, the exclusive U.S. carrier of the only Android phone on sale in the U.S., does not allow tethering. T-Mobile users still can't get that application, a Google spokesperson said, but the ban should not have applied to Android users running HTC's Dream phone in Singapore and Australia, as well as those who paid extra for an unlocked phone.
The company released the following statement:
On Monday, several applications that enable tethering were removed from the Android Market catalog because they were in violation of T-Mobile's terms of service in the US. Based on Android's Developer Distribution Agreement (section 7.2), we remove applications from the Android Market catalog that violate the terms of service of a carrier or manufacturer.
We inadvertently unpublished the applications for all carriers, and today we have corrected the problem so that all Android Market users outside the T-Mobile US network will now have access to the applications. We have notified the affected developers.
It appears Google's commitment to making Android a completely open operating system will be tested by the reality of how wireless carriers have traditionally controlled the applications that run on their network.