Mathman Prophecy

Apple Releases 3G iPhone Friday: This One Has Greater Mass Appeal

You forget to mention that subscription is going up by $10/month. So, you'll be paying an additional $240 for a 2 year contract. Add that to the $199 & $299 iPhones,a nd you get a $439 & $539 for the phones. Considering the $500 price tag, you cited, for the original iPhone... these are More expensive. It's crafty pricing, but at least people will be getting a better phone.