AT&T is selling a refurbished iPhone 3GS for as low as $49 with free shipping and no activation fees when purchased with a $30 per month data service, 2 year contract, and new activation.
The phones are available in either 16GB ($49) or 32GB ($149) capacities and available at these prices while supplies last when ordered from AT&T's Web site.
AT&T will probably run out of these pretty quickly, since these prices are going to be hard to pass up for most people.