You can read about that sort of stuff elsewhere though. Apparently Apple has been testing their CDMA iPhone since 2008, and finally has a chance to roll out a new feature in iOS 4.2.5 that (I assume) AT&T wasn’t too keen on having: portable hotspot. You can flip a toggle switch in the Settings app and broadcast a WiFi hotspot for up to five devices.

You can also set the Personal Hotspot up to use Bluetooth or USB. Obviously, the latter two are for one-to-one connections. Essentially, it looks like this replaces the “tethering” option found in the current iOS build. An Apple rep I talked to believed this was the case as well.

Anyway, I won’t rehash all of the gory details here. You can read up on them from my sources.

Further Reading

• It’s Official: Verizon iPhone Coming in February
• It’s Official: The iPhone 4 Comes to Verizon
• How Personal Hotspot Works On The Verizon iPhone (Pictures)

“While a smartphone user downloads a fraction (typically 1/25th) of the data consumed by a laptop user, the signaling load produced by the smartphone user is much higher and in fact one third of the laptop user on average,” wrote Airvana. “In other words, while it takes 25 smart phones to equal the data throughput from one laptop, it only takes three smart phones to equal the signaling network impact of one laptop (25/3 ≈ 8x).”

The basic idea is that a cellphone does a lot of polling, making various checks and requests as long as the device is on, and most people leave their phone on pretty much all day.

Providers of cellular internet service traditionally have charged steep rates in order to have service for your laptop, and then cap your transfer at an almost unusable level. For instance, the $60/month “DataConnect” plan from AT&T “includes 5 GB of data,” meaning you will pay rather pricey overage rates if you download more than 5GB of data in a month. Unless all you do is check your email, and maybe do some light web surfing, you’re going to blow through that limit pretty quick. (And if you don’t do much more than that, it’s pretty hard to justify paying $60/month for mobile internet service for your laptop.) You’d better make sure your operating system or applications don’t run any software updates, otherwise you’re probably screwed.

Sure, data transfer doesn’t necessarily have too much to do with network congestion primarily caused by gazillions of short pings from smartphones polling for data, but that’s no excuse for such outlandish pricing schemes. If my 1Mb-per-second DSL line costs $45/month, and doesn’t have a transfer limit other than 1Mb x 60 x 60 x 24 x 30, or the amount you can grab in a month at the 1Mb/sec speed cap, why should something that does far less cost $60? For that $60 you get slower speeds, a tiny download cap, and the famous network congestion and spotty coverage that everyone’s always complaining about.

Why should you have to pay extra for so much less? As far as I’m aware, all of the wireless carriers that offer similar services charge similarly exorbitant rates. To date, I have yet to see one of them provide a satisfactory answer as to why they charge so much for practically nothing. (And then talk about throttling smartphone users who dare to use the service they paid for…) All we get are allusions to the suppositious “unique constraints” of wireless networks, and talk of how network neutrality regulations would not only be impractical, but would cripple the networks.