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As we expected, the 3G iPhone was released with much fanfare, but we’re not quite sure why. Sure, a 3G data network and GPS sounds good, but there’s a lot of fine-print that Steve Jobs doesn’t want people to see, especially existing iPhone users.

Let’s state the obvious: push e-mail, the enterprise solution, and all the software functionality announced with the 3G iPhone are non-factors for existing iPhone users, because version 2.0 of the iPhone firmware will be available to all iPhone users. As such, these features are not reasons to drop more money on Apple’s latest cellular product. So aside from the software, what else is there?

Ooh, a blue dot. The only software advantage the 3G iPhone does sport is the GPS integration, but this component is somewhat lacking given existing triangulation functionality in the Google Maps program. That’s because as of now, the GPS-aided navigation is poor compared to any stand-alone GPS solution, and arguably worse than most GPS add-ons for notebooks and PDAs as well. Furthermore, the biggest obstacle for the GPS is the lack of an antenna port, making navigation in a car difficult thanks to many State laws banning windshield-mounted accessories. Even if such items are legal to mount on a windshield in one’s State, actually inputting information from a distance is difficult given the iPhone’s interface, which is exactly why an attachable, flexible antenna would be an ideal accessory. As it stands, the 3G iPhone’s GPS is great for people who need GPS on a bicycle or are foot in non-urban areas, but for everyone else, money is better spent on a real GPS. At least photos can be geo-tagged more accurately now, and real GPS software should eventually be available in the iTunes store.

2X? Apple can’t even advertise their 3G speed claims appropriately. On the 3G page, they list a speed increase over EDGE as 2.4X in large letters, but in smaller print, identify the speed as 2X faster (as per Apple’s front page). So which is it? How about “not really as close to wi-fi speeds as we lead people to believe”? AT&T’s HSDPA “3G network” is already getting some bad press, and is even being called 2.5G because of its poor performance. Maybe holding out for T-Mobile’s 3G network isn’t such a bad idea after all, even if it won’t be available nation-wide until late this year. On the plus side, if one really thinks that their internet use demands twice the speed of EDGE, the 3G iPhone may be worth considering, but since Apple’s advertised speeds are likely best-case scenarios, it’s doubtful that real-world use will be a fantastically different experience than sticking with EDGE. At least the new iPhones are backwards-compatible with EDGE, which means that T-Mobile users can still see real 3G benefits when overseas.

Size? For a company that is constantly pushing for a better form factor, it’s somewhat ironic that the new iPhone isn’t smaller. Some people are claiming that the 3G iPhone is thinner than the original, but this is false. In fact, the 3G iPhone is actually thicker than the original, which isn’t great news for people who were hoping the new iPhone would be closer to the size of the iPod Touch. Fortunately, the size difference is pretty small between the new and old iPhone, but it’s still disappointing.

Same shitty camera. If it’s one thing the new iPhone ought to have improved on, it’s the camera. The un-recessed headphone jack is nice to see, as is the fact that photos can now be geo-tagged, but the 2MP camera is still laughable, especially considering the fact that Sony Ericsson will drop a 5MP camera on the market shortly with the C902. Meanwhile, the iPhone is sans flash, and has minimal camera functionality. Perhaps this is because Apple wants to let third-party developers release camera features via software, but regardless, the hardware behind the camera is just pathetic, especially at close range.

Cheap for AT&T subscribers. The price cut on the 3G iPhone versus the original sounds great, but for unlockers, or those who don’t want an AT&T subscription (like those who pre-pay), the cheap price of $199 for an 8GB model doesn’t apply. Rather, this price is subsidized by the fact that AT&T gets a two-year subscription commitment. There goes the draw for unlockers, if the process will even be possible on the new hardware (we’re guessing it will be). In-store activations FTL.

Not as cheap for AT&T subscribers. Since AT&T considers their 3G network a luxury, they’re adding $10 to the price of the iPhone data plan. That sucks for any AT&T iPhone user, and is another reason we’re happy we unlocked our iPhone to use on T-Mobile. Our earlier price-savings estimate per month on T-Mobile over AT&T can now be updated to reflect this increase: yes, we’re saving $25/month by not sticking with the status quo.

And this is why iPhone 1.0 will rock more. With AT&T users eager to buy the 3G iPhone, second-hand “original” iPhones will likely sell for very cheap. We should see, very shortly, original 8GB iPhones selling for half the price of the new 3G iPhone ($100), and 16GB iPhones for around $150. That’s a great deal for most iPhone users, who don’t need the poor GPS or twice the network speed.

Unlockers: fear. While technically, unlocking the 3G iPhone shouldn’t be a problem, the fact that the phones can only be purchased at brick ‘n mortar locations will make obtaining one without a contract very difficult. This is great for the Apple/AT&T contract, but pretty crappy for everyone else: lines will be longer at stores, and unlockers will ultimately drive up demand for foreign 3G iPhones and second-hand original iPhones.

Our suggestion for most buyers is to hold onto their old iPhones, and for those who don’t have an iPhone yet, to pick up a second-hand iPhone from the many people looking to pick up the sad improvements in 3G model. Not only will this save one a couple Benjamins, but it will still promote Apple’s saturation into the cell-phone market. And re-use of old technology is always good for the environment. At least, until we all fork over money for next year’s model.

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