This is not a complaint about subsidized vs. unsubsidized, let's get that out of the way first. There is one huge point that everyone seems to be forgetting or just don't want to discuss. If you guys remember when the original iPhone came out the 4GB was $499 and the 8GB was $599. I remember because I bought one at that price point! 67 days later, Apple cut the price to $299 and $399 respectively. Why? Because they could sell more phones (make a bit less money however) and supplies were (and are) cheaper. This brings me to iPhone 3G and 3GS. AT&T says that the 'unsubsidized' price of the 3GS phone to be $599 and $699 (16 and 32GB respectively). Now, if we look back in Apple's price point history, they never raise prices on refreshed products... they generally keep them the same price and increase the specs just as they've done to the 3G and now the 3GS. Problem is, if you listen to AT&T they will have you believe their price is $599 and $699 which I believe is utter BS. It is convenient that Apple has nothing to do with the price points because this is controlled by AT&T. My theory is that if Apple were still selling the iPhones unsubsidized that the price points would still be $299 and $399. And that is RETAIL. If anyone is to blame for these stupid price points it is AT&T. Anyway, what are your thoughts on the matter? Am I missing something here?