Though there are rumors that a 3G-capable iPhone is in the works, all official indications are that the initial iteration of the device will make use of "2.5G" (affectionately known as "EDGE" in ATT&T/Cingular's world). Also, it should be noted that (assuming Apple has not secretly placed HSDPA-capable chips in the iPhone) the capability to access Cingular's 3G HSDPA infrastructure is not one that can be added to the iPhone via a software update; access -- at least for already released devices -- requires capable built-in hardware, such as this Qualcomm chipset.
What, in basic terms, does the lack of 3G capability mean for the iPhone? Some salient points of comparison:
3G Being classified as a "3G" network does not guarantee any specific throughput level. Housed under the 3G umbrella are various actual transmission methods with widely varying speeds. Currently, the highest speed 3G American cellular networks include those that use EV-DO technology (Verizon and Sprint) or HSDPA (AT&T/Cingular) networks. 1xEV-DO can deliver theoretical speeds in the neighborhood of 3 megabits per second, while HSDPA can theoretically deliver up to 7.2 megabits per second on select networks.
Real-world performance statistics are, of course, almost comically different from the inflated theoretical speeds. AT&T/Cingular quotes "real-world" download speeds 400-700 kilobits (about 88 kilobytes [KB] per second per second for its HSDPA networks, while Sprint quotes about the same for its "Rev A" EV-DO networks. A few tests, however (like this one from Bare Feats on Verizon's network), have shown real-world speeds of up to 1.8 megabits per second.
At the maximum quoted speed of most readily accessible 3G networks (~700 kilobits per second), a 1 MB file would take about 12 seconds to download.
2.5G 2.5G is not a standard by any real definition. Instead it's a marketing term designed to describe networks that aren't technically 3G, but can achieve speeds far beyond that of initial GSM (2G) implementations.
AT&T's Cingular EDGE -- a 2.5G implementation -- can theoretically provide data rates up to 384 kilobits per second, but peak speeds are around 150 kilobits per second (~19 kilobytes [KB] per second); at that speed a 1 MB file would take about 53 seconds to download.
3G 3G coverage, relative to 2.5G, is scarce. AT&T/Cingular offers. Here is a full listing. The coverage is not nearly as comprehensive as is offered by EDGE, but is definitely expanding quickly beyond major metropolitan areas into smaller cities. There are also large blind spots in purportedly covered marketsÂ -- more apparent than with EDGE networks.
2.5G 2.5G (EDGE) is widely available. AT&T Cingular boasts 13,000 cities and towns covered and you can check your specific location using this coverage map. However, like 3G, there are significant blind spots in some areas, and speed can fluctuate greatly depending on location.