Sorry to rain on the iPhone 3G parade but it has to be done. Here's some not so great news about the iPhone 3G. The iPhone 3G data plan is going to cost $30 per month. That's $10 more than the current iPhone plan. On top of that, current iPhone owners will have to sign a NEW 2-year contract to use the iPhone 3G. Meaning, buying an iPhone 3G won't be a seamless upgrade in the traditional sense. Granted, AT&T won't count the remaining years on your current iPhone contract to the new iPhone 3G contract, the fact that you have to sign a new contract plus the added cost per month just doesn't sit right with me.

Look at it this way, the iPhone 3G costs $199. Hip hip hooray right? Not quite. We have to add the cost of the added monthly fees. First we multiply the 10 dollars more a month by 24 months (the life of a 2 year contract) which equates to $240 dollars more to use the iPhone 3G's data plan versus the original data plan. Now for the simple math, $199 (cost of the iPhone 3G) + $240 (cost of 3G data vs EDGE data over 2 years) = $439 over the lifetime of the contract. That's actually a $40 dollar increase from the current iPhone, not quite the 'half price' that we're being marketed to believe.

Also, it looks like AT&T will discontinue their pre-paid, GoPhone option meaning there is no alternative than being tied into a 2 year voice+3G data contract under AT&T. At least before, some users could choose to use the iPhone as a pseudo-data only device.

Perhaps its because the old revenue sharing model of the original iPhone is no longer in effect, but it looks like AT&T has taken back control of data plans and is positioning the iPhone 3G to increase subscribers and broaden market potential. The carrier subsidy is theoretically included in the $199 price, essentially AT&T is giving Apple the money upfront instead of through a month-to-month revenue sharing plan. Do we as consumers win out? Depends what your perspective is. The iPhone 3G is still a great phone and a steal, but AT&T & Apple are obviously not in the same relationship they were in just one year ago.

So when the iPhone 4G comes is AT&T going to raise our data prices to $40? Will it stop? What do you guys think of this? Does it change your perspective on the price of the iPhone 3G?

UPDATE: Gizmodo is also reporting that the iPhone 3G can only be activated in store via a 10-12 minute process. Also, a fine might be levied to those who don't activate the iPhone 3G within 30 days. It seems like the iPhone no longer carries that unique badge of being separate from the rest of the other phones in AT&T's lineup anymore..

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