electronista reported on Friday, the day the iPad 3G version went on sale, that certain iPad apps are running at poor quality or not running at all over AT&T's 3G connection.
The YouTube app degrades the quality of video, reported iLounge, while ABC's TV viewer won't allow video to run at all unless it's in WiFi mode. Netflix, however, is operating normally. AT&T denies any involvement, telling TechCrunch that the question is for Apple to answer.
Subsequent investigations showed apps providers may be doing this on their own. ABC is reportedly kept from streaming over 3G because of rights issues, and YouTube is most likely using the same bitrate scaling it uses on the iPhone, with the larger screen size making drops in quality more noticeable.
electronista noted that AT&T is known to have asked for adaptive video quality on the iPhone to avoid heavy data traffic on the network, but it has not made it an official requirement.