The change of policy came after the release of carrier update 5.1 that provided Telstra’s iPhone customers with the correct settings to enable tethering. ("Tethering" is the use of a smartphone as a modem for linking to a conventional computer). Telstra initially said the ban was due to a prohibition by Apple, but Apple said that it had imposed no such restrictions and that Telstra, like other carriers, was free to offer tethering according to its own policies.

Today, Telstra spokesman Peter Habib elaborated to APC, saying "access to the tethering function on iPhones is controlled by Apple. This capability is normally activated through iTunes, however Apple disabled this on iPhones supplied to Telstra," though that doesn't exclude the possibility that the phones were supplied in this state at the request of the now-departed former Telstra management team.