That's a good issue to raise. My cingular 8125 was upgraded to the cingular 8525 within 3 months of my purchase. I went in and talked to the cingular people about the change and my desire to have the newer/faster phone. They said "sorry."
I would imagine that, if this cellular phone is treated the way the US cell phone companies have historically done business-- once you buy it -- you've got it for the duration of the contract. That's not to say you can't upgrade- certainly you can - but you'll pay full price for it.
Usually the way it goes is that you can upgrade to a newer phone whenever you want, you just have to pay full price for it (and also possibly sign a new contract). I'm guessing they said "sorry" because you wanted the phone at the "contract" rate. When you go into a phone store and they have phones on display for free, or $50, or $100, that's always the price when you sign a new 2-year contract. The full price of those phones is like $300 or $400. Anyone can go into a cell phone store and ask to buy a phone full price with no contract. But if you're already on a contract with the company, and you want to upgrade the phone, as long as you pay the full price for the phone, there's nothing stopping you from doing that. You're not locked into the phone, you're locked into the service.
Anyway. I can't wait for the iPhone to come out. I'm already crossing the days off my calendar. The only thing is that I HATE rebates... In fact, I was supposed to get a $150 rebate on my current phone and never got one in the mail. The rebate company claims that they never recieved my rebate submission and that I should try to send it again. When faced with the obvious question of "if the rebate requires the ORIGINAL sales receipt and UPC from the box, and i already sent you those, how am i supposed to send the originals again?", I get a "well that's not our problem". So... I've made it a policy to never buy anything on rebate again because it's too easy for the rebate company to convinently "lose" your submission, or claim that they mailed the check and that it must have gotten lost in the mail, or whatever.
I was going to get an iPhone anyway at full price, and if they want to offer a rebate, well I'll go ahead and try. What I'm REALLY not looking forward to is finding out how much the voice + unlimited data is going to cost. That's going to hurt... I'm thinking maybe $100+ a month. BUT I also have to figure that my current voice-only verizon phone is about $50 a month after taxes and fees anyway. So the "$1200 a year" price really only comes out to "$600 extra a year", which isn't so bad. I mean, one way or another I'm going to pay at least $600 a year for voice anyway.
What would make the iPhone really worth it would be if I could use it as a modem on my power mac. I'll be curious to see how fast the data is and if it could serve as a replacement for my DSL. If the iPhone voice + data could replace my current verizon voice and DSL, then I'd break about even on the iPhone service costs.