Doesn’t look like it. The iPhone is in an AT&T prison and it looks like it won’t even be up for parole until early 2011.

When the iPhone was released in 2007 as an exclusive AT&T phone, millions (including me) made the jump to AT&T. We ended up with a great phone but a horrible network. While AT&T and Apple kept the details of their agreements quiet the initial rumors were that it was a two year exclusive agreement. So iPhone users saw a light at the end of the tunnel, and that someday they could take their iPhones to Verizon. And yet here it is, mid 2010, and there is still no Verizon iPhone. And it looks like we have, in part, the iPad to thank for that.

There’s no question that AT&T wants to remain the exclusive iPhone (and now iPad) carrier. So it looks like they have made whatever concessions necessary to keep their deal with Apple. It started with AT&T increasing the iPhone handset subsidies paid to Apple which lead to another year of exclusivity. Bringing us up to the present, leading many to believe that the recent iPhone OS 4 announcement would also include a Verizon iPhone announcement. No such luck. Why? The iPad.

Thanks to the extremely flexible and moderately priced iPad 3G data packages, Apple agreed to give the iPad to AT&T and decided to extend the AT&T iPhone exclusive agreement until the start of 2011 adding another six months of exclusive access to Apple’s iPhone. Ugh.

I think a big question that needs to be asked here is, does AT&T really win by doing this? There are now hundreds of thousands of iPad 3G owners looking to surf, stream and download to their hearts content on an already strained network for a mere $30 a month for unlimited usage. This will continue to bog down AT&T’s already overworked 3G network and could potentially stir up even more dissatisfied iPhone and iPad users. If Verizon had an iPhone today I would move to Verizon without a question, because of AT&T’s high percentage of dropped calls. However, if AT&T got their act together over the next six months and I saw a dramatic improvement in call quality I would stay with AT&T. So, should AT&T have given up being the exclusive carrier for the iPad and focused instead on improving both their network and the public’s image of their network? That remains to be seen. In the meantime, we are chained to the AT&T network until early 2011 and then the rumors will start up all over again.

UPDATE: Shortly after this post was written it seems that new evidence has been found stating that AT&T and Apple signed a five year exclusive deal. That’s a shockingly long time in an industry where everything can change completely in 5 years.