Watch instantly App for the iPhone (coming soon)?

Over the last months, the discussion and tension between Apple and ATT have led to concerns that ATT or Apple are molding the release of apps to influence or control the kind of data flowing through the data networks (of ATT).

Now there is talk that Netflix will release a watch instantly app [via TUAW.com] for the iPhone. What would this do?

Any movie in the instant queue of your Netlifx account would be available to stream to the iPhone from the web. No need to rent or sync to the iPhone, but just click, wait a few seconds (maybe a minute) and off you go. Many speculate it would require a wifi connection (between the needs for the bandwidth and mostly for fear of crippling ATT’s data network further).

Anyone hearing anything about this? Excited about this? Let us know.

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