subsidizing

iPhone 3G owners who are ineligible for a subsidized upgrade to the iPhone 3G S will really enjoy this little find. During my quest to buy a 3G S today (I'm ineligible for an upgrade) I stumbled across a way to get the 3G S at the full subsidized price. The trick is you need to go to an AT&T store to get it done. Read on for the details!

How AT&T Decides If iPhone 3G Owners Get A Subsidized iPhone 3G S

After AT&T announced that select iPhone 3G owners would be eligible for a fully subsidized iPhone 3G S the Internet let out a collective sigh of relief. We were told that early adopters would get the better deal and that eligibility status would be updated on the 18th. Well the 18th came, and many 3G owners, including those who bought on day one, were disappointed.

So what's the deal here? How exactly does AT&T determine if you get a fully subsidized iPhone 3G S? Well I spent most of this morning trying to figure it out and here's how it works:

According to Oppenheimer analyst Yair Reiner, US carrier AT&T is subsidizing the iPhone 3G by $325, not $200 as previously suspected, placing Apple's total cost for each device at $525 for the 8GB and $625 for the 16GB. In addition, he also states that AT&T is paying Apple an additional $100 for each iPhone 3G that is sold in Apple Stores for unknown reasons.