If you were still within contract you could buy an iPhone 3G/3GS for full price and now Apple is apparently making that an option for anyone who wants to pay an exorbitant amount for an iPhone. As Gizmodo reports and shows you can buy an 8GB iPhone 3G for $499, 16GB 3GS for $599, and 32GB 3GS for $699. However, these are still LOCKED to AT&T so you really do not gain much of anything by paying this huge price for a device. It sure makes the new AT&T Nexus One a more attractive option at $529 that is fully SIM unlocked and gives US buyers who are not used to paying anything other than subsidized prices a nice comparison of how much these devices really can cost.
I am not sure who would ever buy one of these locked AT&T devices at this price and don't think it will do anything to clear out any iPhone inventory. Shoot, for these prices you should probably get a free or low cost AT&T phone and buy an iPad. I have been buying SIM unlocked phones for years because I move through phones quickly and never have any contract upgrade availability, but would never pay the full price for a locked phone. Can anyone figure out why someone would buy a locked phone at these prices?