I can't believe AT&T would not let me upgrade to the newer 3GS because my bill was not up-to-date! I have been with AT&T for over 5 years and have not defaulted on my bill at all. My bill is due by the 10th of each month, BUT I have until the 18th to have it paid-in-full. AT&T will noy let you add the $49.00 charge to your existing bill, so you have to pay for the phone up front. This is part that I don't understand - If you have to pay for the phone up front, then why would AT&T not car if your bill is paid up? It's not like they can't turn your service off. The phone is paid for at the time you purchase it. Really bums me out that AT&T would not let me purchase this phone.
it's pretty reasonable. they're letting you have a phone for $400 cheaper than it's full price and all they ask if that you pay your bill. it's standard policy, they're not picking on you. all this information was given to you at the time you started service so it's not like they never told you about it.
*I am an AT&T employee and the postings on this site are my own and don't necessarily represent AT&T's position, strategies or opinions.