The barrier to many peoples’ purchase of the Apple iPhone when it was released almost a year ago was the high price. Apple and AT&T will address that issue with the new 3g iPhone which is due this summer. Not only is the new 3g iPhone sleeker and sexier than the old model – its size has been cut from an already wafer thin 11.7mm to 9.2mm – but it will be up to $200 cheaper. This massive price cut will be available to buyers of the 3g iPhone who sign up for a two year contract with AT&T so despite AT&T having to pay Apple a cut of its tariff profits each month, it is sure to make back the investment quickly enough.

Apple is rumored to be planning to stop supplies of the original iPhone a few weeks prior to the new models’ launch. This will create a demand that will then be filled by the new 3g iPhone model.