iPhone 3G FAQ

Editor's note: Though this FAQ posted originally on June 11, we updated it on July 1 to reflect new information from AT&T.

Is your heart aflutter at the thought of buying an iPhone 3G? Are you counting the days until the July 11 release date? If this describes you, or even if you are just toying with the idea, there are a few things you'll need to know. The process for buying an iPhone 3G will be quite different from what it was last year for the original model. Fortunately, CNET is here to tell you all you should need to know.

The iPhone 3G

(Credit: James Martin/CNET Networks)

Q: What's so great about the iPhone 3G?
A: The iPhone 3G adds important features that were absent on the original iPhone. It now has support for AT&T's 3G network, true GPS, and Microsoft Exchange server. The iPhone 3G also will support third-party applications available through the upcoming App Store. Its design is different as well, but not by much.

Q: What's not great about it?
A: We were hoping to see a few more features, including multimedia messaging, voice dialing, video recording, and a landscape keyboard.

Q: So should I get it?
A: If you want an iPhone, but haven't yet bought one, this is the iPhone for you. If you already own an iPhone, the choice isn't as clear. However, if you can afford to upgrade, you should. The added features will be worth it. We only stress that you should verify that AT&T has adequate 3G coverage in your area. If you buy it and you find out that your 3G service is inadequate you'll have 30 days to return the iPhone without paying an early termination fee.

Q: Where can I buy the iPhone 3G?
A: It will be available only in Apple and AT&T stores. You'll also be able to get it at AT&T kiosks in shopping malls but it will not be available online. The iPhone 3G will go on sale at 8 a.m. local time on Friday, July 11.

Q: Wait, so I can't get it on the Apple or AT&T Web sites?
A: No, you'll have to go to a store, which is more than inconvenient if you don't live near one.

Q: Can I still activate my phone using iTunes?
A: Unfortunately, you'll have to do that in an Apple or an AT&T store as well. You will not be able to take it home and do it there. Major bummer. There will be an activation fee of either $18 for existing customers eligible for an upgrade, or $36 for new customers.

Q: Why are AT&T and Apple doing that?
A: We suspect that it's a way to crack down on iPhones that were purchased but were never activated on AT&T's network. By forcing you to activate the phone in a store, you'll be forced to sign up for AT&T service.

Q: Won't that create a mob scene on stores on July 11?
A: It should be pretty crazy that day. Though stores were mobbed last year, buyers had only to pay for their phone and get out. This year, however, they'll have to go through the entire process for credit approval, contract signing, and activation before they can leave. If you figure that each person will take at least 15 minutes to complete their transaction, then we should see some long, and slowly moving, lines.

Out with the old.

(Credit: Corinne Schulze/CNET Networks)

Q: Will AT&T employees be working in Apple stores?
A: Probably not. Apple has not released details, but we expect that the process will be similar to how stores such as Best Buy handle cell phone activations now. It's likely that you'll be dealing with an Apple employee who will have access to AT&T's computer system.

Q: How much will the iPhone 3G cost?
A: This is one area of good news. While last year buyers paid up to $600 for their iPhones, the iPhone 3G will be significantly cheaper. The 8GB model will cost $199 and the 16GB model will cost $299, both with a two-year contract. However, to get that price, current AT&T customers must be "upgrade eligible". To find out if you're eligible, contact AT&T. If you don't qualify, the iPhone 3G will be $399 for the 8GB model or $499 for the 16GB version. Both require a two-year contract as well.

Q: Is there price for the iPhone 3G without signing a contract?
A: Customers who purchase the phone without a contract will pay $599 for the 8GB version or $699 for the 16GB model.

Q: Can I use an iPhone 3G with AT&T's Go Phone prepaid service?
A: Not at the moment. But this may happen in the future.

Q: What about a family plan?
A: AT&T hasn't addressed this yet.

Q: But what's this I hear about the plans being more expensive?
A: It's true that Apple and AT&T are changing the structure and pricing for the iPhone 3G plans. Unlike with the previous handset, you will have to select separate voice and data plans (they won't be combined). Voice plans, which are the same for all AT&T handsets, range from $39.99 to $79.99 per month, depending on the available minutes. Unlimited data plans will be $30 for consumers and $45 business users.

As a result, the cheapest monthly cost for an iPhone user will be $69.99 for unlimited data, plus 450 anytime minutes and 5,000 nights and weekends. That's $10 more than what current iPhone users' pay for comparable services.

Q: The original data plan came with 200 free text messages. How much text messaging do the new data plans include?
A: AT&T is charging $5 for every 200 text messages; $15 for every 1,500 messages; and $20 for unlimited text messages.

Q: Will the new $30 and $45 a month data plans offered for the iPhone 3G be the same as the standard data plans for other AT&T smartphones?
A: Not necessarily. According to AT&, it is still working out the details and will have more information closer to July 11 when the phones go on sale.

Q: I heard that people who already have a first-generation iPhone have to turn it in to an Apple or AT&T store if they want the 3G phone. Is that true?
A: No, but AT&T is giving people who bought their first-generation iPhone on or after May 27, 2008, the opportunity to exchange it before August 1. AT&T and Apple will refund the difference in price but iPhone 3G users will have to sign a new two-year contract and choose a new plan. If you go this route, don't forget to erase your personal data.

Q: If I keep my current iPhone, will I miss out on all the new features?
A: Through the iPhone 2.0 software update, you'll get a lot of new goodies including the third-party applications and the Exchange server support. Yet, you will miss out on the 3G and GPS.

In with the new.

(Credit: Apple)

Q: I already have a comparable smartphone from AT&T and a two-year service contract. Can I buy the iPhone 3G for the $199 price and simply restart my contract?
A: It depends on when you started your initial AT&T contract. To get the $199 price tag, you have to meet AT&T's upgrade eligibility criteria. We'll know more on that later. But for the most part, even current AT&T customers will need to sign a new contract.

Q: Let's say I bought my iPhone last year and I want the iPhone 3G. Can I give my old iPhone to my sister or sell it on eBay?
A: No, once an existing iPhone user activates service for an iPhone 3G, their first-generation handset will be unusable as a phone. You won't be able to replace it with another AT&T SIM card and use it to make calls. This also means that you can't buy an old iPhone on eBay and expect to activate it on AT&T's network. However, you can use it as a media player and a Wi-Fi device for browsing the Web.

Correction: Originally, we had received incorrect information from a source at AT&T. If you decide to pass it on to someone else, they will be able to activate the phone through iTunes but only by activating a new account. If you (or anyone else) do not open a new account, the old iPhone will be unusable as a phone, even if you insert another AT&T SIM card. In that case, you can use the handset only as a media player and a Wi-Fi device.

G: Given the in-store activation requirement, how can I buy an iPhone 3G as a gift?
A: We're not sure yet, but we're checking with AT&T.

Q: Will people living in areas without native AT&T coverage be able to buy an iPhone 3G?
A: No, anyone buying an iPhone 3G must live in an area where AT&T provides coverage. Since the phones will be activated right in the store, people won't be able to leave the store without activating the phone for service in area where AT&T is offered.

Q: Will the SIM come preinstalled this time?
A: Yes, the SIM is already installed and is not meant to be removed or replaced with other AT&T SIM cards (though it is physically possible to do so). On the other hand, Apple will include a SIM removal tool in the box.

Q: Do I have to be in the store to get software updates or to sync it with iTunes?
A: No, updates and syncing with iTunes can be done right from your home computer. You can also buy applications from the App Store from your computer.

Q: Can I use the iPhone 3G overseas?
A: As a quad-band GSM phone with support for three 3G bands, you'll be able to use the new iPhone all over the world. Just remember that the phone will be locked to AT&T so you won't be able to use another carrier's SIM card. If you're a frequent globe-trotter, you should ask about AT&T's international plans to avoid nasty surprises on your bill.

Q: Will the iPhone ever come to other carriers in the United States?
A: There is a chance it could come to T-Mobile, but it won't be for a long time. AT&T is believed to have a five-year lock on the iPhone (now through 2012), but other reports indicate that its monopoly will be up in 2010. Unfortunately, it's unlikely that Apple will ever develop a CDMA version for Sprint or Verizon Wireless.

CNET News.com's Marguerite Reardon and Dawn Kawamoto contributed to this report.