Over the weekend, hordes of SXSW attendees overloaded AT&T's wireless network in Austin, Texas, with their iPhones and other 3G-enabled devices. In response, AT&T doubled its network capacity in the city in a matter of hours. Why wasn't AT&T's network capable of handling the demand in the first place?When the iPhone 3G launched in July 2008, it was pretty clear from the start that there were lots of problems related to its ability to access AT&T's 3G network. Apple -- not AT&T -- took the fall, and in September issued a major firmware update for the 3G iPhone that "fixed" the iPhone's ability to connect to AT&T's 3G network. Which company was really to blame for the iPhone fiasco?

Om Malik, chief writer for GigaOm, targets AT&T, and wants to know: Why won't it own up to its 3G network issues? In a blog posted yesterday, Malik said, "AT&T keeps denying that it has any network bandwidth problems and continued its state of denial in an article in the New York Times this past weekend. Kristin S. Rinne, senior VP of architecture and planning for AT&T, blamed the phones and the chipsets on handsets for some of the problems." At the same time, SXSW was kicking off in Austin. Om continues, "AT&T's network choked and suddenly everyone was up in arms. And then Ma Bell got in touch with Stacey [Higginbotham, who contributes to GigaOm], who reported that AT&T was boosting its network capacity."

AT&T operates its network in the 850- to 1,900-MHz bands across the United States. Cell phones sold by AT&T can access either band. Between the two slices of spectrum, AT&T has major portions of the U.S. covered, so cell phones will work wherever it has either 850- or 1,900-MHz spectrum.

In Austin, AT&T was using just the 1,900-MHz band. In response to the outcry by SXSW attendees, AT&T doubled its network capacity in Austin by firing up the 850-MHz band on eight different towers that cover downtown Austin. This spectrum had been used for AT&T's analog network, and, according to Malik, AT&T will be turning on 850 MHz in San Francicso and New York City at some point later this year to add to its 3G capacity in those markets.

It was nice of AT&T to respond to this clear demand for bandwidth, but the question is, why wasn't the bandwidth there in the first place? Malik contends that AT&T is knowingly selling 3G devices that it doesn't necessarily have the capacity to support.

Is AT&T selling under false pretenses? Should the FCC get involved?

To date, AT&T has vigorously defended the capacity of its network, despite the highly public issues it has faced in the last year.

AT&T is forgetting that sometimes transparency is better than recalcitrance.