In what seems like pure insanity to the average person with an iPhone, AT&T changed its Wireless Data Service Terms and Conditions to include a clause that prohibits apps like the upcoming SlingPlayer Mobile for iPhone.

The new terms outline AT&T's new prohibited data usage on the company's Plan Terms page. Here are the changes added to the terms of the wireless data service. Items we think will be in iPhone owners' interest are in bold.

Examples of prohibited uses include, without limitation, the following: (i) server devices or host computer applications, including, but not limited to, Web camera posts or broadcasts, automatic data feeds, automated machine-to-machine connections or peer-to-peer (P2P) file sharing; (ii) as a substitute or backup for private lines, landlines or full-time or dedicated data connections; (iii) "auto-responders," "cancel-bots," or similar automated or manual routines which generate excessive amounts of net traffic, or which disrupt net user groups or email use by others; (iv) "spam" or unsolicited commercial or bulk email (or activities that have the effect of facilitating unsolicited commercial email or unsolicited bulk email); (v) any activity that adversely affects the ability of other people or systems to use either AT&T's wireless services or other parties' Internet-based resources, including "denial of service" (DoS) attacks against another network host or individual user; (vi) accessing, or attempting to access without authority, the accounts of others, or to penetrate, or attempt to penetrate, security measures of AT&T's wireless network or another entity's network or systems;  (vii) software or other devices that maintain continuous active Internet connections when a computer's connection would otherwise be idle or any "keep alive" functions, unless they adhere to AT&T's data retry requirements, which may be changed from time to time. This means, by way of example only, that checking email, surfing the Internet, downloading legally acquired songs, and/or visiting corporate intranets is permitted, but downloading movies using P2P file sharing services, customer initiated redirection of television or other video or audio signals via any technology from a fixed location to a mobile device, web broadcasting, and/or for the operation of servers, telemetry devices and/or Supervisory Control and Data Acquisition devices is prohibited. Furthermore, plans (unless specifically designated for tethering usage) cannot be used for any applications that tether the device (through use of, including without limitation, connection kits, other phone/PDA-to computer accessories, Bluetooth® or any other wireless technology) to Personal Computers (including without limitation, laptops), or other equipment for any purpose.

It seems that AT&T has media streaming apps in the no-fly zone of prohibited apps. In addition to the forthcoming SlingPlayer Mobile app being prohibited for its "redirection of television or other video or audio signals via any technology from a fixed location to a mobile device," Mac|Life staff favorite Simplify Media also seems to run afoul of the new terms.

We're also concerned that Pandora could be a no-no with its ability to "maintain continuous active internet connections when a computer's connection would otherwise be idle..." There is a whole host of apps this could potentially hurt.

Robb Topolski over at Public Knowledge, the person that shared AT&T's TOS changes with the Internet, believes this may have to do with the bad press AT&T garnered when it charged an AT&T wireless internet subscriber $28,000 to watch a football game with the service. It turns out the customer was in Miami and not out to sea, which would have justified the world's most expensive football experience. With the new TOS, the football game streaming would have been prohibited outright.

Whatever the reasoning, AT&T isn't making any new friends today.

UPDATE: AT&T has reversed its decision to change its terms. We can continue our media streaming ways. Horray for the Internet.