It will be using all AT&T’s standard voice and data plans, which means $30 for unlimited 3G data for consumers, $45 for business users, on top of voice. Also, no in-home activation for iPhone 3G—it does require a two-year contract, and it will have to be activated in store (at AT&T or Apple Store), which takes 10-12 minutes [….]
Basically, the true cost of the iPhone is still staying in the $400 range: AT&T is just subsidizing it down to $199 in exchange for a 2-year contract, like every other phone on the market. Except now, there isn’t an alternative: you can’t seem to pay a little extra for a 1-year contract, for example.
Interestingly, this also ends the revenue-sharing agreement, so Apple has decided that getting more iPhones sold is better for them overall than getting $10-20/month of kickbacks per user. I agree that this is the right move: more iPhones means more App Store users, more iTunes Store customers, more iPhone-accessory buyers, and more people encouraged to use other Apple products.