Apple’s genius move was not in lowering the price of the iPhone 3G to $199 and $299, it was in supercharging and transforming .Mac into MobileMe. Sure Apple is losing out on subscription revenue from the carriers, but they are potentially gaining much more with annual MobileMe subscriptions. I’ve been a .Mac user for a number of years right now; it was hard to justify to another person why .Mac was useful, but with MobileMe, I don’t see this being the case anymore.
Smart move, Apple!
tow.com 
I think iPhone 3G is subsidized now, hence Apple shouldn’t loose too much money on sales. On another hand AT&T has increased cost of data plan by $10 which over two year contract brings price of iPhone 3G back to where it was. We will have to wait and see how well this strategy plays out :)
BTW, I stumbled across your wp-smugmug plugin, great idea ! I like it but it a lot, but seems it only works for single post page and doesn’t on main blog. Not sure if that is design limitation or I’m missing some knob somewhere…
Thanks. There’s some improvements coming down the pipe with my SmugMug plugin.
I agree that the single most important announcement yesterday was MobileMe. The next important announcement was the 2.0 software upgrade. Both of which I can get still using my “old” iPhone. I don’t see any justifiable reason to buy the new iPhone 3G. In fact, I’m getting pretty fed up with carrying around my iPhone AND another cell phone due to AT&T’s less than stellar reception. I’m contemplating canceling my AT&T account and eating it on the cancelation fee. BUT I do agree that MobileMe is spectacular (name not withstanding).
Adam,
It looks good and with 3G now on board as it should have been from the word go – I’m very tempted! But surely SURELY they could improve the camera?! I currently use a Sony Ericsson K850i (since Oct 07) and it packs a punchy 5MP camera – now I know it’ll never replace the proper kit – but its great for snaps! 2.0MP over here in Ireland is akin to something from about 3-4 years ago. It doesn’t have auto focus or flash either :-( surely this is bound to irk the photographer in you ? ;-)