AT&T said that starting next Thursday, they will begin selling the iPhone 3G smartphones without requiring a two-year contract. As with the current subsidized models, the cost will be tiered based on storage capacity: the 8GB model will cost $599 without contract, and the 16GB model will be available for $699 without contract.

The phones will still be locked to AT&T’s network and there are no plans to offer prepaid service for the smartphone.

AT&T is about to (finally) make good on its promise to offer a “Pay-As-You-Go” plan without the usual requirement for a two-year service contact. For those scared of making commitments, your phobia comes at a high price. This “no-commit” pricing is only available to existing AT&T wireless customers, but activation is not required at time-of-sale.

Under AT&T’s current pricing, basic iPhone voice and data costs $69.95-a-month, with text messaging an additional $5-$20 monthly, depending on how many messages you expect to send.

So the question I want to know is – Is this a smart move for AT&T?

Here is their current monthly pricing structure:

Let’s break it down hypothetically:

-You buy an 8GB iPhone at the subsidized price of $199 with the required two-year service plan. (If you cancel service on day 31 of the contract, the early termination fee is “up to $175″ according to AT&T’s Web site.)

- $199 for the phone + $175 for early termination =  $374 ($225 less than the $599 no-contract iPhone).

- $69.95/month for basic voice/data gives you 3 months of service.

So unless AT&T also plans on offering reduced price service to go along with this “Pay-As-You-Go” plan, it makes absolutely no sense for anyone with any brain to go ahead and pay $599 or even $699 for a no-contract iPhone. You can buy the subsidized phone, get three months of service, then pay the early termination fee and still come out a little bit ahead of paying the $599 no-contract price.

The only thing I can think about the logic behind AT&T’s new plan is that they have no intention of selling many if any iPhones at these prices. Maybe no-commit pricing is just a marketing-ploy in order to impress their current customers with how much buying the new iPhone with a two-year commitment “saves” them. So from that perspective, it may turn out to be a really good plan for AT&T to gain up some of those customers that Sprint keeps losing!

I’m sorry but I don’t want to insult my readers but if you buy this phone at full price, you are a moron… What do you think about this tactic that AT&T is taking?