3G iPhone to be discounted to $199 by AT&T?

According to Fortune, AT&T will subsidize the cost of the new, 3G iPhone by as much as $200, bringing the price within the $199 range. Apparently, a "person familiar with the strategy" claims that the provider will create this bargain bonanza for customers signing new, two-year contracts. Of course, the author of the story also says that the new phones will be available in "8-gigabit-memory and... 16-gigabit-memory" versions (for $399 and $499, respectively), so take that as you like. In addition to these discounts, the source says the new iPhone will be 2.5mm thinner than the previous iteration, although we understand that right after telling Fortune this information, the "person" burst into a cloud of rainbow-colored sparkles and went flying off into the night sky.

[Thanks, Penny]