9:45 AM -- You don't really get a feel for IPTV's potential until you see the iPhone trick.

That trick, as demonstrated during a visit to AT&T Inc. (NYSE: T)'s Atlanta IPTV lab last week, involves taking an iPhone, connecting to a U-verse home network, and using it as a remote control via a Web interface found at a specific URL or network address.

On the TV, your viewing choices suddenly change from a standard TV menu to the iPhone user's preset favorite channel list. On the DVR, the iPhone user's recorded shows were listed first and take priority while he's in control.

Conceivably, the colors and look and feel of the U-verse guide could have changed, depending on the iPhone user's preferences. Maybe, via the TV menu, you could retrieve some voice mail messages from your home or cell phone and reply to the calls using your iPhone and a Webcam attached to your set-top.

Anyway, the iPhone trick sufficed to make a larger point: When your TV remote is suddenly a WiFi-connected device with a high-resolution touch-screen, you forget, for a minute, about being locked in to a particular way of doing things.

I saw a laptop, for instance, that also acted as a remote control, but it was more of an entertainment console, with channel guides, DVR control, programming previews and other extras that took advantage of the screen size and processing power. Not an everyday function I'd ever use, but a good illustration of the concept that the IP in IPTV really does matter.

I should state here that AT&T has no expressed plans to create a remote control app for the iPhone or the laptop. Nor has it said it will allow folks to check voice mail via U-verse TV menus. And, no, it hasn't provided personalized channel guides for every member of a household. Mileage may vary. Close cover before striking. Etc.

My point: The iPhone trick is a demo and nothing more. Yet.

But all the possibilities -- and the discussions of possibilities -- suggest something good for AT&T in particular and telcos in general, as we've been hearing for the past few years at NXTcomm and other industry shows: If Internet protocol is fully exploited, some new features and billable services become transparent software upgrades. Some of the Web's most engaging activities can make their way to the living room, if the timing is right and if the business model makes sense.

Those are some big "ifs."

— Phil Harvey, Editor, Light Reading