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That was quick: iPhone price cut

The iPhone is barely two months old, and it has already dropped in price. Hooray! No longer will you have to shell out $600 just to get a phone — a phone that has slow as snails Internet access. And it wasn’t a token price drop, either: $200 came off the price tag. They also announced a few other items, including the discontinuation of the 4 GB iPhone. Good move, we say. However, these moves do not come without a catch. They never do.

Before, the iPhone price was not a subsidized one. You paid your $600 and you had a phone, plain and simple. If you wanted to activate it, fine. If not, you could do whatever you want with it, including making it a $600 paperweight (breaking some kind of unofficial record, we’re sure).

Now you’re required to sign up for a two-year contract with AT&T. This is clearly in response to the wave of iPhone hacks that appears late last month. Both AT&T and Apple clearly realized that they needed to require immediate activation, just as AT&T does with all of their other phones. The way to make this more palpable was to drop the price of the phone.

Of course, none of this has been mentioned by Apple or AT&T. Rather, they’re making other excuses for the price drop (which came as a surprise to most, including us):

“We’ve clearly got a breakthrough product and we want to make it affordable for even more customers as we enter this holiday season,” Steve Jobs, Apple’s chief executive, said in a press release. Said Bill Medlow, president of the Long Island Macintosh Users Group, “This will sort of loosen up a lot of these pocketbooks.”

Of course, Apple won’t offer a refund of any kind to the initial buyers. And why would they? Those are the Apple faithful, and they decided that $600 was a fair price for the device. It’s not like Apple is going to say “oops, we overcharged you, here’s a handout.”

Although it has nothing to do with prepaid, a new line of iPods was announced as well. The devices are Wi-Fi ready and are also touch screen. They’ll cost $250 for an 80 GB model, and $350 for 160 gigs. The Wi-Fi will allow users to download songs from iTunes right to their iPod. We’re waiting for an official announcement on an iTunes subscription service, which will simply rock.

(Personal aside: The way in which we sell and purchase music is stupid. Downright moronic. You know what would work well? Paying $250 a year to have unlimited access to music. Any music. We don’t care if we don’t own it; we just want to listen to it.)