3G iPhone to cost $199?

Everyone seems to think that Apple will be announcing a 3G iPhone this coming June, so now it is time to start rumormongering about something else. Fortune is reporting that, according to sources close to the story, AT&T is planning on taking a $200 hit on every iPhone sold (with a 2 year contract, of course). That's right, AT&T is going to knock off $200 on the 3G iPhone to ensure that everyone and their toddlers have (and use all the wonderful features that AT&T's network has to offer) an iPhone or two in their pocket.

This rumor doesn't seem too outlandish to me, given the realities of the cell phone market. Most cell phones are given away for free, since the carriers make their money from the monthly fees. The only wrinkle in the story, of course, is that Apple also receives a cut of the money from the monthly contracts. We'll see if that impacts AT&T's plans at all.
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