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The increasing head-to-head between the iPhone and the BlackBerry, as the latter shifts its attention to consumer and advanced media markets, will create new dilemmas for AT&T, which is also supposed to be the exclusive operator for the first RIM 3G phone, the much vaunted Bold. But while the Bold has launched in Canada, the UK and 10 other countries, there is still no sign of it in the US, and the iPhone may well be the reason. Analysts say that iPhone data traffic is clogging up AT&T's 3G network - there have been many complaints of dropped calls and poor performance, and the Apple handset lacks the data compression technology that BlackBerry supports - and so the carrier does not dare release another device with bandwidth hogging tendencies just yet.

In a research note to clients, Peter Misek, an analyst with Canaccord Adams, highlighted the benefits of working with RIM, and how the BlackBerry maker has protected US cellcos from the weaknesses of their early 3G networks - problems that European and Asian carriers have had to address more aggressively. "AT&T really relied upon RIM for its data network management," Misek wrote. "Recall that RIM manages virtually all of the data traffic for its carriers globally ... AT&T in our view was spoiled by the fact that RIM essentially shielded the carrier from the full burden on the network."

While BlackBerry data traffic is channelled through RIM's servers, the iPhone uses a 'ping-pong' technology that must constantly access AT&T's network. But for all the advantages of the Bold, AT&T has to be careful not to overload its network further, or distract customers from the iPhone before it hits its most aggressive targets for keeping Apple happy. "We believe that AT&T is now realizing that it can have up to 20 BlackBerrys for every iPhone on its network," Misek went on, estimating that AT&T will need to spend up to $1bn to make its 3G network suitable for advanced mobile internet and media usage with phones like Apple's.

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