Despite Steve Jobs’ best efforts to spin the new iPhone 3G‘s cost, the real user costs are starting to emerge, and it’s not pretty.

The iPhone 3G isn’t just more expensive to buy with an AT&T contract, but it’s more expensive to buy if you plan on using it “unlocked”:

• Subscribers can buy the iPhone 3G for $199 for the 8-gigabyte model or $299 for the 16-gigabyte version. Those prices require two-year contracts.
• Existing AT&T subscribers who don’t qualify for an upgrade discount can purchase the iPhone 3G for $399 for the 8-gigabyte model or $499 for the 16-gigabyte device. Both options will require a new two-year service agreement
• A no-contract-required option will be available in the future for $599 for the 8-gigabyte iPhone or $699 for the 16-gigabyte iPhone.

With the iPhone 3G, the biggest innovation appears to be tuning the way the device is sold to maximize profits. The real innovation is likely to come from the iTunes App Store & 3rd party developers.