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Want an iPhone 3G S? Already have an iPhone 3G? Be prepared to pay $700 to upgrade [Updated]

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Better read the fine print, friends. Apple said today that the iPhone 3G S costs $199 (16GB) and $299 (32GB). But that’s the price only for new AT&T customers. The price if you’re already an AT&T customer and/or are upgrading from an iPhone 3G? Try $699 (32GB), $599 (16GB), and $499 (8GB). To quote Peter Ha: “HOLY SHIT.”

I think I speak for most of the Internet when I say that price is 100 percent ridiculous. How many iPhone 3G’s are floating around out there? And how many of those will be upgraded to the new iPhone 3G S?

I don’t know who’s to blame, Apple or AT&T, but I cannot wait to see them try to spin this news.

UPDATE So this is what AT&T tells us:

An iPhone 3G customer in most cases can early upgrade at $399 [16GB] or $499 [32GB].

You’ll note that that’s still several hundred dollars more than what Joe Smoe would have to pay, right off the street, if he doesn’t already have an AT&T account.

And what does “early upgrade” mean? Or “most cases”? The joys of dealing with AT&T!

My recommendation would be to call AT&T yourself to see what you’re looking at.

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