What does it mean when a 16GB 3G iPhone costs about the same as an 8GB iPod touch? Is it the AT&T kickback economics finally coming into reality? Or are we going to see an iPod touch price drop sometime soon? Face it. The iPhone is just a better device than the iPod touch. And if you can get one cheaper? Why not. It has a built-in speaker and microphone too, assuming you can get past that activation screen.
So if you have the choice between buying one or the other, the iPhone is a really sweet alternative. And if the iPod touch comes down in price? Even better.
A normal subsidization is only available to new customers and customers eligible for upgrade. Regardless of what you are though, you have the option to buy the phone for the larger, retail price and not be stuck in a contract.
The iPhone absolutely requires a contract. There is no way to activate it without starting a new contract, or extending your current contract by 2 years. For this reason, the price has been set at $199 and $299 for everyone. If you are in the middle of your current contract, if you are a new customer, if you are eligible for upgrade, the price remains the same. It is subsidized, just differently than normal, so there is no higher, retail price.
