Some people prefer prepaid mobile phone plans, which don't require a contract and often cost less, especially for those who don't use their phone a lot. Another advantage is that you're not locked into a contract. There have been rumors of prepaid plans for the iPhone. And Verizon and AT&T have just announced new prepaid plans, with some speculating that this is in preparation for a prepaid iPhone coming out in October. See AppleInsider for more information.