Oh, and what might be a fairer system for AT&T?
1)Let iphone users update every year. <-Probably not going to happen with AT&T.
2)Add the cost of the Early Termination Fee (ETF) (,which congress mandated be a prorated against the carrier's vocal protest,) to end the current contract and then give the subsidized price while having to sign a new contract. <- This would average $125 for the upgrade to current iPhone 3g users who got it on launch day.
I think option...