AT&T Caught in a Telecom Triangle

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In a brief blog post yesterday, Google (NYSE: GOOG  ) said its Nexus One smartphone is now compatible with AT&T's (NYSE: T  ) 3G network here and Rogers Communications Inc.'s (NYSE: RCI  ) wireless network in Canada.

Don't read too much into that. AT&T isn't about to give store shelf space to the Nexus One as it does Apple's (Nasdaq: AAPL  ) iPhone. Would-be owners of the device hoping to hook up with the former Ms. Bell's network will have to buy directly from Google.

But that's a minor annoyance. What matters is that Google is creating the conditions for a head-to-head match-up between its signature Android phone and the iPhone. Mix in Motorola's (NYSE: MOT  ) Backflip phone, which is also designed to work with AT&T's 3G network, and we've got all we'll need to measure Android's poaching power.

Canada won't make for as big a battleground, though Rogers is also an iPhone partner. Local hero Research In Motion (Nasdaq: RIMM  ) is too dominant a supplier in the Great White North.

How will Nexus One fare against the iPhone here in the U.S.? Not well, I'm guessing. Early sales data was less-than-encouraging and we know that developers love the iPhone. They've created more than 150,000 apps for the device, which users consume in far greater volume than peers who use Android phones and Palm's (Nasdaq: PALM  ) webOS-powered devices.

So while AT&T may enjoy its dalliance with Android, it has every reason to stay hitched to Apple and the iPhone. In this telecom triangle, Google's the odd company out.

Think I'm wrong? Is there more to the story? Please take a moment to vote in the poll below. You can also share your thoughts in the comments section.

Apple is a Motley Fool Stock Advisor selection. Google is a Motley Fool Rule Breakers recommendation. Rogers Communications is a Motley Fool Income Investor pick. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Tim Beyers is a member of the Rule Breakers stock-picking team. He had stock and options positions in Apple and a stock position in Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. The Fool's disclosure policy can't get to the phone. Would you mind answering that?

Read/Post Comments (2) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 17, 2010, at 7:13 PM, Pre101 wrote:

    The poll is a little short on options. I think a much better option will be the Palm Pre (or its successor) when it appears on AT&T.

  • Report this Comment On March 18, 2010, at 5:14 PM, conradsands wrote:

    Verizon and AT&T = The Most Expensive Wireless Calling Plans in America

    Wireless Profit Margins:

    Verizon Wireless = 45 percent

    AT&T = 39 percent

    Sprint = 18.2 percent

    Now we know where Verizon and AT&T get all that money to run commercials 24x7 and pay out big executive bonuses -- the American consumer.

    Not all pricing claims are the same. The advantages consumers get with Sprint’s $69.99 Everything Data plan include nationwide unlimited text and picture messaging, unlimited Web, unlimited GPS navigation and unlimited calling to any mobile in America, compared to AT&T and Verizon’s $69.99 pricing plans, which are good for unlimited talk only. And Sprint’s $69.99 plans are available with any phone while AT&T and Verizon’s are limited to lower-end phones.

    AT&T and Verizon have attempted to confuse the marketplace by lowering their pricing to $69.99, but theirs are for calling only. In today’s economic environment customers are interested in more than just voice pricing. They also want the best value for all the other things they rely on their wireless phone for and Sprint delivers. Sprint's Everything Data plans start at $69.99 per month and include Any Mobile, Anytime for unlimited calling with any U.S. wireless user, plus unlimited text, picture and video messaging, e-mail, Web browsing, social networking and more.

    4G wireless--which operates at speeds up to 10 times greater than today's 3G networks--could become a reality for many businesses and consumers over the coming year. Sprint, the current 4G leader, says it will introduce its first 4G smartphone before mid-year.

    Sprint Nextel is expected to unveil the first phone compatible with its fourth-generation mobile network at a wireless conference next week, according to people familiar with the matter.

    The device, made by HTC Corp. and dubbed the Supersonic, represents Sprint's latest and biggest bet that its WiMax network and promises of a speedier wireless connection.

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