Financial Times is like the UK's Wall Street Journal, so they don't print things lightly—truth likelihood is very high. And they're saying that the next iPhone will be subsidised and much cheaper than the current one, like we already knew:
The new version of the Apple iPhone is set to be sold at significantly lower prices than the existing one, in a tacit acknowledgment by the US technology company that its previous sales strategy was not sustainable. Apple has bowed to pressure from mobile phone operators and agreed they can subsidise the latest iPhone, expected to be unveiled by Steve Jobs, Apple's chief executive, on Monday.
While the confirmation of the cheaper, subsidised iPhone comes from their own undoubtedly rock solid sources, they don't have specific numbers from them and point to squishy analysts on how much cheaper it'll be, such as speculation it'll be US$199 in the US, with a US$200 subsidy from AT&T. Either way, AT&T will definitely be bearing some of the costs for us: "Apple has accepted that the new iPhone should be subsidised in the US and western Europe by the mobile operators who sell it to consumers, according to people familiar with the matter."
But US$200 does sound right.