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Yeah, it's an extra $20 month for tethering and increases your bandwidth from 2GB / month to 4GB / month.

Want it for free / cheap (considering MyWi costs...)? Jailbreak! :)

Yes. Jailbreaking and MyWi is just as good a solution, and far cheaper.

I generally do not recommend jailbreaking because it voids your warranty and you have a contract with the carrier. Should your iPhone go poof, you'll be looking at a big bill for purchasing another at full price around $600 plus taxes.

I kind of agree. If you know what you're doing, jailbreaking is really a non-issue. Problem with your phone? Just restore / reformat before bringing it into an Apple Store and they're none the wiser (besides, they always ask if you tried restoring your phone first). I say this as someone who has been around the block, jail-breaking every iPhone I've had (all the way back to 1st-gen).

The only time this wouldn't work is if something happens to your 30-pin connector, in which case Apple won't cover it anyway since it's accidental damage.

You're probably spending that $600 anyway if you go with AT&T's tethering plan.

Well...

If you are on a 2-year contract, for tethering you would pay
$20 × 24 months = $480

If you are 9 months into your contract (if you got your iPhone4 on day 1), you'll end up paying
$20 × 15 months = $300

Paying AT&T for tethering is much cheaper than risking your warranty with jailbreaking. Save your money and use some of it to get Applecare for your iPhone4. ^_^

Eh, I think it's almost a wash, no matter how you look at it. For me, I've been jailbreaking my iPhone 4 since it was possible.

$10 for MyWi upgrade to work w/ iOS 4.
$0.00 x 9 months = $0.00

Total cost so far for tethering w/ JB: $10.

So I've saved anywhere from $300 - $480 that I could apply to my next iPhone should it break.

I always caution people against jailbreaking because when I got my iPhone 3G almost 2.5 years ago, I needed 7 replacements in 9 months, and the Geniuses in the Apple Store were the nicest guys in the after-sale customer care business.

The iPhones I had had all kinds of problems ranging from:
• stuck pixels on the display to
• unresponsive home button (you had to press it really really had to get it to work) to
• spotty 3G reception (even where another iPhones were doing just fine) to
• faulty bluetooth or wifi to
• random reboots no matter how many times the Genius in the Store forced a fresh firmware install.

At that time, Apple didn't offer Applecare protection plan for iPhones in Canada. When my 7th iPhone gave up the ghost outside it's warranty period, I switched to Android, and I've been happy for the most part.

For me, when it comes to Apple products, nothing is more important than maintaining a valid warranty. Replacements are expensive.

Hah! Interestingly enough, I feel you. 4 first gen iPhones, and 2 iPhone 3Gs! So far, the iPhone 3GS and the iPhone 4 have been the only solid iPhones for me. Here is my list of iPhones:

1.) iPhone 1st-gen: Touch screen stopped working.
2.) iPhone 1st-gen: Touch screen stopped working.
3.) iPhone 1st-gen: Some weird short caused constant “device not designed for iPhone. Please use airplane mode” messages to appear, even if nothing was hooked up!
4.) iPhone 1st-gen: Dock connector completely stopped working.
5.) iPhone 3G #1: Upgraded to iPhone 3G by choice. Hoping for relief. Just kidding! Glass screen began to delaminate from iPhone. Weird defect.
6.) iPhone 3G #2: Hopefully it will be perfect for now?
7.) iPhone 3GS: (Upgrade) Worked perfectly!
8.) iPhone 4: (Upgrade) Works perfectly, so far!

I would have continued to use an iPhone but I had to relocate to a different country as part of my job. There are no Apple stores around here, and so warranty issues can cause a lot of pain because the carrier is responsible for taking care of that. (AT&T is not unique. They are all SoBs.).

Right around that time, Android became a credible competitor to the iPhone and I switched. I got the original Droid/Milestone, then the Nexus One, and now I'm waiting for the next big thing. Probably the HTC Incredible S or Motorola Atrix when it is available unlocked.

You said you have an iPhone 4, so you're already paying that bill every month. I believe you can turn on the personal hotspot for $20 additional a month and you can take that feature off anytime too.

But using the iPhone as a hotspot will definitely reduce the battery runtime before you need to charge it again because you will have both 3G and WiFi radios on at the same time.

Good point

Oh, one more thing I should add. I'm still on a legacy unlimited data plan on my iPhone and if I turn this on, they will put me on a new contract and kill that. The solution might be to jail break and use one of the hotspot apps.

Well... there have been anecdotal claims that AT&T has been offering unlimited plans (unofficially) to customers considering switching to Verizon. You may be in luck!

But AT&T would love to charge you extra to split your already limited bandwidth cap/quota/budget between your iPhone4 and your iPad and other devices. And charge you even more when you exceed your cap! ^_^

They improved their plan recently actually, so while you pay $20 more for the privilege of tethering/personal hotspot, you at least get two more GB's per month now. I think it's a lot less evil than it used to be.