Only new customers and those who are out of contract qualify for the new iPhone prices. That leaves a lot of current iPhone and iPhone 3G users scratching their heads about how much it will cost them to upgrade to the new iPhone 3G S.
When Apple released the iPhone 3G owners of the original iPhone had three months to upgrade to the newer version for a reduced fee. That is not the case with upgrades to this latest version, because the iPhone 3G was heavily subsidised by the carrier (O2 in the UK, AT&T in the US) on release and that subsidy needs to be paid back.
It's not too difficult to work out how much you might have to pay, but it does get seriously expensive - on currently reported upgrade prices. There is already outrage among existing iPhone users on the apparent costs of upgrading.
Upgrading iPhone 3G to iPhone 3G S
The iPhone 3G has been sold in the UK since July 10, 2008. That means that all current pay-monthly iPhone owners are still within their 18-month or 24-month contracts. The earliest that these contracts ends is January 10, 2010.
The currently reported O2 iPhone 3G S upgrade path appears to require such users to pay the remaining cost of their contract, plus the cost of the newer handset.
The early upgrade cost is therefore likely to be your monthly cost multiplied by the number of months left on your contract. So even someone who bought the iPhone 3G on its day of launch would have seven months left of their contract to pay up. On the £34.26 tariff that's going to cost you £239.82 just to pay up your contract, and a further £185 just to buy the 16GB iPhone 3G S on the same tariff - a total of £424.80 for the entry-level model on an 18-month contract!
(You could get it for cheaper on the 24-month contract, but I doubt many people being stung for signing up for 18 months are going to willingly sign up for two years just to get stung again when the next iPhone version arrives.)
The no-contract Pay-As-You-Go iPhone 3G S costs £440.40 for the 16GB model, but calls and texts are extra, of course - and the unlimited data lasts for just a year.
Upgrading iPhone to iPhone 3G S
The original iPhone (non-3G) was launched in the UK on November 9, 2007 on 18-month contracts. Those early adopters who bought on day 1 got out of contract in May 2009 - just one month before the launch of the latest 3G S version of the iPhone.
Some original iPhone users will therefore be out of contract and so can enjoy the standard prices for the iPhone 3G S. These depend of the monthly tariff and iPhone model you choose (see below).
Anyone who bought an original iPhone more than just one month after the launch is still in contract, and will have to pay off the remaining months of that contract as well as pay for the new iPhone 3G S handset.
As with the iPhone 3G users, this looks expensive. The early upgrade cost is likely to be your monthly cost multiplied by the number of months left on your contract. So even someone who bought the iPhone six months after its UK launch would still have five months left of their contract to pay up - adding £171.30 to the price of the new iPhone 3G S.
iPhone 3G S tariff and contract options
There are seven O2 tariffs to choose from, costing £29.38 (75 mins talk, 125 texts), £34.26 (600 mins talk, 500 texts), £44.05 (1,200 mins talk, 500 texts), and £73.41 (3,000 mins talk, 500 texts), on an 18-month contract and £34.26, £44.05 and £73.41 on a 24-month contract. (All tariffs include unlimited UK data and Wi-Fi.)
There are two different models of the iPhone 3G S: 16GB and 32GB.
Buying a 16GB iPhone 3G S on an 18-month contract costs £184.98 on the £29/month and £34/month tariffs. On the £44/month tariff the 16GB iPhone 3G S costs £87.11, and it's free on the top-end £73/month tariff.
Buying a 32GB iPhone 3G S on an 18-month contract costs £274.23 on the £29/month and £34/month tariffs. On the £44/month tariff the 16GB iPhone 3G S costs £175.19, and £96.89 on the top-end £73/month tariff.
Buying a 16GB iPhone 3G S on a 24-month contract costs £87.11 on the £34/month tariff, and is free on all other tariffs. (There's no £29/month tariff on a 24-month contract.)
Buying a 32GB iPhone 3G S on a 24-month contract costs £175.19 on the £34/month tariff. On the £44/month tariff the 32GB iPhone 3G S costs £96.89, and is free on the top-end £73/month tariff.
Apple/O2 are also selling the iPhone 3G from £96.89 at the cheaper tariffs and free on 24-month contracts.
Do you really need to upgrade to iPhone 3G S?
At those costs many iPhone and iPhone 3G users will resist the temptation to upgrade to the 3G S.
The iPhone 3G S has some nice new features that current iPhone users will desire: a better (but not brilliant camera), video capability, faster processor speed for niftier apps, an integrated digital compass, more storage, and voice controls.
(iPod touch owners can download the new release for a small fee, and it will work on first- and second-generation iPod touch models.)
So if you want to keep up to date with the latest iPhone goodness much of it will be available with the free download on June 17, 2009.