AT&T just gave us new details on how their upgrading plans will work for the iPhone 3G. The company is treating the iPhone 3G pretty much just like any other phone in that people who are ineligible for upgrades have to pay the full, unsubsidised price for the phone. People who qualify for upgrade status and people who have an original iPhone are free to upgrade at the US$199/US$299 price set by Apple. AT&T hasn't specified what the unsubsidised price is, so we'll update when we know more. Here's how you know if you're eligible.
AT&T Cell Phone Upgrade
Am I Eligible for an AT&T Cell Phone Upgrade?
Not all Cingular/AT&T customers may qualify for a cell phone upgrade. At this time, AT&T Mobility allows these customers to upgrade with no upgrade fee when they commit to a new 2-year contract:
AT&T customers who have had 24 months of cell phone service since activation of their cell phone or since their last phone upgrade.
Certain AT&T customers may be eligible for a cell phone upgrade even if they have been in their current plan for less than two years (24 months), if they commit to a new 2-year contract and meet these eligibility requirements:
Customer has had a standard calling plan plus data services costing at least $68.99 a month but no more than $98.99 a month, and who has been in contract (and not had a phone upgrade) for 21 months or more,
Customer has had a standard calling plan plus data services costing $99 a month or more, and who has been in contract (and not upgraded) in the last 12 months.
A customer with a calling plan and data services of less than $69 who is 21 to 23 months into contract may upgrade for a fee and a commitment of an additional two-year service contract extension. No upgrade fee is assessed for any customers who are on a month-to-month agreement.
Note that AT&T upgrade eligibility may be further limited based on customer's usage history, payment record, previous phone replacement, etc. Upgrade eligibility is solely determined by AT&T Mobility at its discretion.