Rumor: AT&T Selling Unlocked iPhones with No Contract March 26

AT&T is set to begin offering existing customers iPhone 3G on March 26 without requiring on-site activation or the 2 year service contract new and upgrade customers must agree to in order to buy a phone at reduced pricing, according to a report at Boy Genius.

Claiming to be based on internal AT&T training slides describing the new policies, the report indicates existing AT&T customers will be able to purchase a limit of one device per phone line at $599 (8GB) and $699 (16GB) without committing to the usual 2 year contract required of new customers wishing to purchase an iPhone.

New AT&T customers will still be required to sign a 2 year service contract in order to activate iPhones on the AT&T network and all phones activated for AT&T service will still be required to carry an iPhone data plan.