Apple could have agreed to let AT&T subsidize the price of the forthcoming 3G iPhone in the U.S.A. an internet report indicates.

The 3G iPhone which is expected to arrive around June of this year, could cost only $199 to AT&T customers who take a plan with a two year commitment, a Fortune report [1] claims.

"AT&T is preparing to subsidize $200 of the cost of a new iPhone, bringing the price down to $199 for customers who sign two-year contracts, the source says. Apple is expected to have two versions of the new iPhone, an 8-gigabyte-memory and a 16-gigabyte-memory model with price tags widely expected to be $399 and $499."

Both 8GB and 16GB version should remain available at similar pricing to the current lineup of iPhones, or $399 and $499.