UPDATE: TiPb asked for AT&T's side of this story, and here it is:

"The AT&T wireless network is designed and engineered to deliver the highest possible levels of capacity and performance. Our standing as the nation's fastest 3G network is validated by multiple third-party testing organizations on the basis of millions of drive tests annually.  

"We believe that recent online speculation regarding AT&T wireless network configuration settings is without foundation. Allegations in these posts regarding packet loss network settings are incorrect."

ORIGINAL: In a post entitled Has AT&T Wireless data congestion been self-inflicted? the blog Communications explores whether the iPhone-on-AT&T problems we keep hearing about are the result of misconfigured buffers in AT&T's mobile core network leading to congestion collapse.

It appears AT&T Wireless has configured their RNC buffers so there is no packet loss, i.e. with buffers capable of holding more than ten seconds of data. Zero packet loss may sound impressive to a telephone guy, but it causes TCP congestion collapse and thus doesn't work for the mobile Internet!

The article is way over our heads, but give it a read and let us know your take-away. There's obviously something going on that results in iPhone users on AT&T, especially in New York and San Francisco having connection issues, dropped calls, etc. Could this, at least in part, explain it?