Apple has made it very clear that there will be no subsidizing in the iphone. That is their philosophy, especially with all their hardware. They make premium product for a premium cost. Plus the razr started at the 500 dollar mark, and it was an iconic symbol of status. Moto whored it out with rebates, and has struggled to make a profit ever since. More does not always equal more.
You will need to front atleast 500 clams to purchase an iphone, apple will not subsidize the phone cost. However, there has been much speculation that ATT will subsidize the data plan costs at a much reduced costs, maybe even for free. A normal plan is somewhat around $20 min for voice and $50 a month for data for $70 a month total. There has also been speculation that Att will offer a voice free data plan, which would be a first for the company i believe, saving customers $20 a month. There is even more speculation that ATT will offer six months of free data service, to entice customers with some sort of subsidation.
You may not need to sign a ridiculous contract at all however, as recently rumors have surfaced that the iphone will have a pay as you go plan.
However, besides these facts: Apple bought 100,000 15in LED screens; The stevenote is tuesday june 11th; the iphone recieved fcc approval; and ATT is reving up the marketing machine; we don't know anything. Most of what i told is based on rumors to inflate or kill the stock price. In fact, 75% are scared shitless that apple has nothing up their sleeve and the other 25% have fallen to blindness from RFD. You may not get much happy conversation regarding the iphone here, as most of us gotten ulsers of worry within the last four months talking about it, but you are free to do some checks in the archives. Read it all, its some good stuff.
P.S. 3G (Third Generation) is the leading edge technology on the market, available in major cities, for broadband data downloading. ATT does not offer it and many in the apple community think that it was foolish of apple to bind themselves to a somewhat feeble company, we'll see. ATT does offer EDGE which is a 2.75G tech, but apparently bitch ass slow (though ive never really used it, i wouldnt know.)
P.S.S. Ultimately we are all hoping that the iphone is release June 1st with wimax internet, skype, video conferencing with the camera in the screen, 32gb hardrive, updated .mac hosting service, ms. pacman, a built lazer pointer, and a "shadow steve for a day" card. However when apple fails to deliver our wildest fantasies the stock will fall after releasing an awesome product and a quarter of us will commit suicide.
PSSS. Oh and this website will speculate that the iphone will destroy the ipod and declare it as news, promtly after banning my existance for eternity.
I think thats about it, ill write if i think of anything else. search the archives, there is good stuff.