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Can AT&T handle the Apple iPad?

Already, AT&T has problems handling data requests from iPhone users in major cities such as San Francisco and New York. What happens when the Apple iPad hits the market?

By Matthew Shaer / January 28, 2010

With a full Web browser, HD YouTube videos, and iTunes download store, will the iPad's optional 3G antenna put too much of a strain on the AT&T network? Already the Apple iPhone is struggling in some cities, such as New York and San Fransisco.

Qi Heng/Xinhua/Newscom

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Yesterday, Apple CEO Steve Jobs finally unveiled the Apple iPad – time to stop calling it the tablet, folks – a slate-like device that occupies a middle-ground between the company's popular MacBooks and the Apple iPhone. The iPad has been received enthusiastically on Twitter and Facebook, and the few early hands-on tests are promising.

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Of course when it comes to a device this hyped, there's always going to be a little backlash. In the case of the Apple iPad, much of the concern centers – rightly, perhaps – around the data plan. Here's the deal: Apple is offering two options for consumers when the iPad launches later this year. The first is an unlimited plan for $29.99 per month and the second has a monthly cap of 250MB for $14.99 a month.

Apple will sell you a Wi-Fi-connected 16GB iPad for $499. For $629, you can get an iPad that utilizes Wi-Fi and 3G, like the current model iPhone. And therein lies the rub. As we have explained in the past, AT&T has major problems when it comes to keeping up with data requests on the iPhone, especially in high-density metro areas. The symptoms include – but are not limited to – dropped calls, dead zones, and weird static squeaks.

Initially, some bloggers speculated that iPad owners would have a choice between Verizon and AT&T. But it looks like AT&T is going to get another exclusive on the Apple iPad. See the issue? Of course, Apple is standing by their man. In a recent interview, Tim Cook, chief operating officer at Apple, called AT&T "a great partner."

Even AT&T has admitted that its New York network is "performing at levels below [its] standards." The problem, according to the carrier, is that iPhone users are data guzzlers. On average, the feature-heavy phone gulps down 10 times the network capacity of other smart phones. And as users browse the Web, watch videos, download apps, and stream music on their iPhones, the device has strained AT&T's network.

In December, AT&T said that it will push back against rampant data usage. New "incentives" to curb bandwidth hogs could include a tiered pricing structure with limits on how much each phone may download or pay-per-usage plans that meter monthly activity. Many shot back at these remarks, reminding AT&T that iPhones come with an unlimited data plan. You can't use too much of something that's "unlimited." Could the iPad's 250MB monthly cap mark the beginning of tiered pricing for the iPhone?

Either way, the iPad will no doubt add more strain to an already encumbered network. And, for Apple, tethering the iPad to the fortunes of AT&T seems like a risky bid.

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What are your thoughts? Check out our iPad coverage page for more on the new tablet, and drop us a line in the comments section or on Twitter.

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