AT&T still remains reluctant to introduce US iPhone customers to tethering and judging from their latest response to Engadget's inquiry, we wouldn't expect it anytime too soon.

"iPhone tethering has the potential to exponentially increase traffic, and we need to ensure that we're able to deliver excellent performance for the feature – over and above the increases in data traffic we're already seeing – before we will offer the feature."

Admitting their network is not up the challenge of providing tethering to iPhone users just yet gets them some points for at least being honest. However, with Verizon now offering MiFi-like free mobile hotspot service to all Palm Pre Plus owners, however, and Sprint intending to paid hotspot service for the EVO 4G when it arrives, the competitive ball is racing towards AT&T's court.

Here's an idea -- how about this June/July when the iPhone HD/iPhone4G AT&T gives us a mobile hotspot app for that?