Yesterday, AT&T spokesman Mark Siegel told Gearlog that his company is upgrading their 3G services to include the 850MHz spectrum. As it stands, most 3G services run at 1900MHz and the spectrum is getting congested. The upgrades should alleviate some of that congestion.

This is good news for all of the new 3GS owners this week, but particularly those in cities like New York and San Francisco, where iPhone saturation is highest, along with network strain. The 850MHz frequency is a lower band, allowing it to travel further and penetrate walls more easily than 1900MHz.

Along with a more reliable signal in cities, AT&T customers could see 3G hitting previously EDGE-only service areas, though it probably won’t extend service areas by much. AT&T is also starting to upgrade to HSDPA, which is supposed to double the download speeds of their current network.

It’s nice to see AT&T trying to keep up with the influx of iPhone traffic, but it still feels like just that. Keeping up. And barely. Hopefully these changes will add enough stability to keep people happy until HSDPA provides a stronger backbone for the nation’s only iPhone provider.