Why is Apple Scared of the Free Market with iPhone 3G?

Disclaimer: I’m an Apple fanatic. I love its hardware, I love its software. I’ve evangelized the Mac platform to my friends, family and coworkers and I’m directly responsible for “switching” at least a dozen of them since becoming a believer myself in 2002. So, after you read this post, don’t try to claim I’m an Apple hater, because nothing could be further from the truth.

So, yesterday the iPhone 2.0 software and iPhone 3G were announced at Apple’s World Wide Developer Conference, and both will hit the streets sometime in early July. Both software and hardware get some significant upgrades: faster connectivity, more services to connect to, 3rd party applications, true geolocation with A-GPS, etc. These upgrades come at a significantly lower upfront cost to consumers: $199 and $299 for the different memory capacities, 8GB and 16GB respectively.

New Hardware Business Models

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