This Time Article discusses the fact that the new 3G iPhone will be offered for purchase without having to sign a contract. The price will be $400 more than if you bought the iPhone when you signed a contract. However, these phones will still be ‘locked’ meaning you will have to use them on the AT&T network. The reason that the 3G iPhone is so much more without a contract, even though you still have to use AT&T, is that AT&T subsidizes part of the cost of the iPhone each time one is purchased. Also announced is the fact that AT&T has said they are working on a prepaid plan for use with the new 3G iPhone.

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