Wired details Apple, AT&T's 'dysfunctional relationship'

The magazine reports a behind-the-scenes look at Steve Jobs' anger over AT&T network problems, and the carrier's dismay at Apple's refusal to work with them on keeping iPhone data traffic down.

Erica Ogg Former Staff writer, CNET News
Erica Ogg is a CNET News reporter who covers Apple, HP, Dell, and other PC makers, as well as the consumer electronics industry. She's also one of the hosts of CNET News' Daily Podcast. In her non-work life, she's a history geek, a loyal Dodgers fan, and a mac-and-cheese connoisseur.
Erica Ogg
3 min read
Apple's iPhone has brought record customers out to AT&T to buy the device. But the relationship is a giant headache for both companies, according to a report Monday.
Apple's iPhone has brought record customers out to AT&T to buy the device. But the relationship is a giant headache for both companies, according to a report Monday. Maggie Reardon/CNET

Apple and AT&T may be exclusive partners, but neither is very pleased with the current state of the relationship, according to Wired.

On Monday, Wired posted a behind-the-scenes look at the state of the partnership between the iPhone maker and the iPhone's carrier partner in the U.S. News flash: the two are kind of sick of each other.

It's not a complete surprise that Apple and AT&T are unhappy. There have been numerous reports that Apple has tried to end its exclusive contract with AT&T early because of continued network problems in major cities like New York and San Francisco.

But AT&T is equally dismayed at Apple's refusal to work through the problems together, according to Wired writer Fred Vogelstein. He writes that the two companies have butted heads since 2007 on a variety of things: how YouTube videos should be handled, when tethering would be available, and how to dress for board meetings. (AT&T apparently suggested Jobs wear a suit to meet with its directors, to which Apple said its employees "don't own suits.")

The story has several illuminating anecdotes that show how poorly the two get along, but also how mutually beneficial, at least financially, the partnership has been. But it's clear the two have had problems almost since the beginning.

AT&T's network was overwhelmed with iPhone traffic from early on when the device launched in 2007 and asked if Apple would help throttle the traffic, either by making certain data-hungry apps Wi-Fi only, making apps like YouTube lower-resolution, or only allowing YouTube videos to play for one minute, according to Wired's anonymous source. Of course, Apple said no way.

According to Wired's source at Apple, "They'd always end up saying, 'We're going to have to escalate this to senior AT&T executives,' and we always said, 'Fine, we'll escalate it to Steve and see who wins.' I think history has demonstrated how that turned out."

And while Apple has been mostly careful to speak positively of AT&T in the press, Jobs was apparently "apoplectic" about AT&T's network and upgrade schedule, to the point that he went through the motions of actually looking into getting Qualcomm chips that would allow the iPhone to support both Verizon's and AT&T's networks. That was judged unrealistic in the long run, according to the report.

The story goes into detail about the lack of communication between the phone maker and the carrier and calls their relationship "dysfunctional." The best example of that is when Ralph de la Vega, AT&T's head of wireless, made public comments in late 2008 about tethering "coming soon" to the iPhone six months before it was ready to be announced, and before the two companies had discussed the date.

Jobs was "livid" about de la Vega's comments, according to a witness Wired spoke to. "He said, "I'm going to go call Ralph and yell at him.'"

Judging by Wired's account, if Apple does end up bringing the iPhone to Verizon next year, it sounds like the split couldn't come early enough for either Apple or AT&T.