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AT&T to Provide $200 Subsidy on 3G iPhone?

Tuesday April 29, 2008 3:25 pm PDT by Arnold Kim
Fortune.com writer Scott Mortiz claims that AT&T is planning to offer a subsidy of as much as $200 on Apple's upcoming next-generation iPhone.

AT&T is preparing to subsidize $200 of the cost of a new iPhone, bringing the price down to $199 for customers who sign two-year contracts, the source says. Apple is expected to have two versions of the new iPhone, an 8-gigabyte-memory and a 16-gigabyte-memory model with price tags widely expected to be $399 and $499.

The subsidy would only be available to customers signing up for service with AT&T, and meant to increase demand for the already popular phone. The use of subsidies has already begun with overseas carriers in the UK and Germany, though these discounts have been applied to move existing iPhone stock, rather than on brand new products.

The source for the article also reveals that the new iPhone will be approximately 9.2 mm thick, 2.5 mm thinner than the current form factor. This contrasts with recent rumors from Engadget claiming that the 3G iPhone will be slightly thicker than the current model. Additionally, Fortune's source concurs with Engadget and others on the inclusion of GPS in the updated iPhone.

Finally, the source claims that the updated iPhone will be released on or about June 27th, to approximately coincide with the one-year anniversary of the original iPhone launch on June 29th, 2007.

Mortiz, who previously wrote for TheStreet, has not had a particularly good track record with Apple rumors, however. Previous inaccurate claims included delivery of a 1st Quarter 2008 3G iPhone and an erroneous report on a drop in iPhone production.

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