Very few products have gotten the amount of free publicity that the Apple iPhone has gotten since it was announced in January. The phone will finally be available during June, and will serve as a great marketing platform for the reintroduction of AT&T — the Cingular name will likely disappear for good this month as well.

If you’d like to be notified when the iPhone is available, click here.

iPhone Features

• Exclusive to AT&T for 5 years
• Available with 4GB & 8GB memory (8GB iPOD Nano can hold up to 2,000 songs)
• Prices will be $499 and $599 for the 4GB and 8GB, respectively (about $300 more than the equivalent Nano)
• No discount for new AT&T customers — everyone pays the same price (at least initially)
• A different and unique tactile experience — a touch screen instead of a keypad
• GSM quad band, allowing for overseas use
• EDGE data — much slower downloading and web browsing than is available on the 3G network available on several other AT&T phones. However, the phone does support WiFi
• 2 megapixel camera — toward the higher quality end of currently available cell phone cameras

iPhone Alternatives

Don’t want to spend $500 for a music phone? Here are some currently available alternatives worth considering. You can’t download iTunes to these phones, but you’ll save enough to buy a separate iPOD and about 200 songs from the iTunes store.

LG enV for Verizon Wireless (Free*)
Motorola RAZR V3xx for AT&T (Free*)
Nokia 5300 Xpress for T-Mobile (**)
Samsung UpStage for Sprint (Free*)

* From MyRatePlan retail partners as of 6/1/07 for a new subscriber signing a 2 year contract
** See website for special low price

One of the major trends in phones this year is color. Many of the most popular phones are seeing their time on the market extended as new hues are released. Here’s a list of some popular phones and their color variations:

Motorola Razr V3xx (Gray & Gold)

Nokia 5300 (Black & Lilac)

Palm Treo 680 (Graphite, Crimson & Copper)

BlackBerry Pearl (Silver & Red)

Cingular SYNC (Black, Blue & Red)

Motorola KRZR (Black, White & Red)

LG Chocolate (Black, White, Cherry & Mint)

Sanyo Katana (Black, White, Blue & Pink)

Verizon is now offering streaming LIVE television broadcasts, available in select cities. Only a couple of recently-released headsets are capable of supporting this feature. As of this writing, these include the LG VX9400 and the Samsung U620. For $15 to $25 a month, you get 8 channels, including Comedy Central, ESPN and MTV. For more on this feature, click here.

If you live in an area with AT&T local phone service, and are considering Cingular/AT&T wireless service, check out the new AT&T Unity cell phone plans. For the most part, these are priced the same as existing Cingular plans but have a couple big differences. Unity plans expand free calling from all Cingular phones (free mobile-to-mobile) to free calling to all other AT&T lines. AT&T claims this means free calling to about 100 million phone lines overall.

To have a Unity plan, you must subscribe (or already have) to a qualifying unlimited AT&T local service plan PLUS an unlimited AT&T long distance plan.

What’s the Catch? There are a couple trade-offs here:

The lowest price Unity plan is $59.99, whereas the lowest regular Cingular plan is $39.99. Unless you are a moderate or heavy user of wireless, you may end up overspending to get the Unity feature.

Unity plans have no rollover feature.

The requirement to have local phone service, particularly the unlimited long distance feature, limits your ability to consider less expensive options that might better fit your calling patterns like VoIP or stand-alone long distance which is now as low as 2.5 cents/minute.

When filing your 2006 taxes, don’t forget to claim your one-time refund for federal excise taxes paid on your telephone bills, available to anyone who has paid for long distance or bundled service since February 28, 2003. Rather than requiring people to dig up old phone bills, the IRS has set fixed amounts for the credit. For individuals, the rebate is $30 if you claim one exemption, $40 for two, $50 for three and $60 for four or more. Businesses can figure out their actual taxes paid, or use a much simpler formula that the IRS has created.

Las spring, after losing a number of court cases, the IRS decided to stop collecting the 3% federal excise tax on telecom (except local service), an assessment that has been around in one form or another since the turn of the 20th century. In addition, the agency decided to refund excise taxes paid from February, 2003 to August, 2006. The above estimates ($30 to $60) were created to avoid having consumers having to locate and dig through 3+ years of phone bills (although you can file for a different credit if you go back and figure out your actual tax paid).

According to the Treasury Department, about $10 billion will be refunded back to individuals as a result of this credit.

Earlier this fall, T-Mobile introduced a series of myFaves rate plans, providing unlimited calling to any 5 numbers that the subscriber selects. These numbers need not be T-Mobile subscribers, nor do they have to be cell phone numbers.

Sounds good right?

For those that call a few people frequently, these plans may save money. However, for most, we would recommend sticking with one of the traditional T-Mobile plans (those without myFaves in the name). Two reasons:

Fewer minutes for the same price. myFaves plans are $10 more than traditional plans for the same number of minutes. For example $49.99 for 600 minutes with myFaves vs. $39.99 for 600 minutes without. There is a $39.99 myFaves plan with 300 minutes, so it is possible to spend the same amount. Just keep in mind that if you actually end up needing 600 minutes, your bill will be $159.99.

Traditional T-Mobile family plans have free mobile-to-mobile calling, myFaves family plans don’t. That means if you want to talk to family members for free, each of you will have to use up one or more of your 5 myFave slots to include that family member. This makes the myFaves family plans particularly unattractive.

The good news is that T-Mobile remains the carrier with some of the best rate plan values out there, along with some of the coolest new phones. They are a good choice for many, just make sure you understand what you are getting in your rate plan.

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T-Mobile Information

Later this year, T-Mobile is expected to roll out plans for a new generation of cell phones, ones that work on both cellular networks and the Internet (via wireless / WiFi connectivity). The idea is that when a person is in a WiFi area, they will use the Internet for their voice calls; saving their plans’s anytime cellular minutes for when they are in an area where a connection isn’t available. The incremental charge for this service, beyond the cellular plan cost, will likely be pretty nominal.

These phones might prove to be the thing that leads to more people ditching their home phone, and going totally wireless. One of the problems with doing so today (going totally wireless) is that in-building or in-home cell signals are often weak. This would address that issue, as those with WiFi in their house (high speed Internet with a wireless router set-up) will be able to use that signal inside the home.

The LG VX8500 Chocolate for Verizon is one of the most popular phones of 2006. Part phone and part MP3 player it is Verizon’s attempt at competing against the iPod. Oddly, unlike almost every other cell phone launched in the last two years, the LG Chocolate did not have a speakerphone.

Verizon is now correcting that. As of early October, a software upgrade will be available for the Chocolate. Existing owners can visit a Verizon retail outlet to get the upgrade. It is assumed that new Chocolate phones will have this upgrade already included.

Once again taking advantage of its very low rate of customers leaving (churn), Verizon has announced some changes to try and further separate itself from the pack. Details aren’t available yet, but the CEO of Verizon announced these changes, for implementation later in 2006:

1. Pro-rate of termination fees: Those closer to the end of their contract won’t have to pay the full $175
2. Upgrades: Those on $49.99 and higher rate plans can get a phone every year at current promotional pricing
3. Free online storage of customer contact information, for easy transfer to a new phone
4. Post-warranty phone replacement for just $50.

We’ll provide more details as they become available.

The 3% Federal Excise Tax, dating to the Spanish-American War will end on July 31st for all but local phone service. This includes long distance on your home phone, wireless and/or VoIP phone service. In addition, it is likely that most will be able to claim a refund for the tax paid over the last 3 years with their 2006 tax returns (the ones filed in early 2007).

When established, the tax was based on calls priced by distance. However, the practice of charging different prices for calls based on distance ended a while ago, and that has led to numerous court challenges on the legality of the tax. Having consistently lost in court, the IRS and Treasury have thrown in the towel.

In terms of claiming a refund on your return next year, the IRS is planning to develop a “simple” process to let people claim this amount. Simple process and IRS are terms that usually don’t occur near each other, so we’ll have to wait and see what they come up with.

Will your future phone bills go down by 3% as a direct result of this repeal? This will likely depend on the segment of the market. It wouldn’t surprise us if some providers attempt to insert or increase a cost recovery fee to offset the savings and make it bill-neutral for the customer. Since these fees are more or less lumped in with items like the telephone tax, consumers not aware of the repeal of this tax would be none the wiser, and your provider would have a quick 3% increase to their profits.