Renew your old iPhone with Flipswap
Of course, Ebay will be flooded with iPhones soon, so consider alternatives like Flipswap. They offer cash for iPhones (and other model phones) and even pay for shipping. Once they've gotten your phone, they put it back in use.
If you're the environmentally consicous type, you'll appreciate this. Phones that cannot be put back into use are disposed of, piece by piece, in "...the greenest methods available today." Also, in lieu of cash, you can trade in your dead phone for a tree as part of their reLeaf Program. Flipswaps estimates they'll plant up to 25,000 trees this year (they take old iPods, too!).
It's free, easy and definitely worth the consideration.
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