US mobile operator AT&T has confirmed it will begin selling Apple’s iPhone 3G next week on a contract-free basis, prompting speculation that the operator is looking to ramp up sales ahead of the expected launch of a new version of the device later this year. AT&T spokesman Michael Coe told Associated Press that the operator would begin selling the device next Thursday for US$599 for the 8GB model and US$699 for the 16GB. The two models currently retail for US$199 or US$299, respectively, under a two-year contract.

However, AT&T said that the devices would remain locked to its network and would only be activated if they are bought with the operator’s regular iPhone plans, which include a US$30 monthly charge for data access, while prepaid services would not be available. AT&T has been the exclusive US distributor of the iPhone since the launch of the first generation version of the device in July 2007; it remained the exclusive operator following the launch of iPhone 3G a year later. It is rumoured that Apple may release a new version of the phone this summer. Operators that offer the iPhone outside of the US – including O2 UK – are also understood to be looking at pricing strategies to boost short-term sales of the device prior to a new version being launched.