The costs of extending your iPhone's warranty, replacing its battery, and having it otherwise repaired are now available. I mistakenly wrote last week in "My First Days with the iPhone" (2007-07-02) that Apple hadn't yet provided details on its AppleCare plan; in fact, those were apparently available for at least a day on the Apple Store's ordering page for the iPhone (click the Warranty button in the bottom right). Other repair information appears to have shown up on or around 02-Jul-07.
The warranty included with the iPhone covers defects for one year and technical support for two years; the latter is tied in with the usual policy of cellular operators providing phone support during a contract period. AppleCare costs $69 per phone and extends the warranty against defects to two years. It may be purchased any time during the first year of ownership, but it's not yet available for sale. Apple is promising AppleCare availability in July, as store employees at an Apple Store told me at the iPhone launch.
Accidents and loss aren't covered, which is consistent with Apple's other warranty programs. However, most cell companies also offer what is generally overpriced, but mostly inclusive, insurance against loss and accidental damage to supplement free coverage for defect repairs. These plans cost $30 to $60 per year, billed monthly, and have a deductible of $35 to $50 or even more, depending on the phone. You can get your phone replaced or repaired only a limited number of times, and the insurer can choose to provide a comparable phone. Apple is having none of that.
Cell carriers, by the way, often do a terrible job of repairing phones that have warranty-covered defects within a reasonable time, while Apple's computer repair service typically gets top ratings by consumer publications. AT&T and Apple are handling repairs and returns through Apple Stores and mail order; AT&T Stores won't handle hardware after it's sold.
According to Apple's iPhone service FAQ, the price for servicing an iPhone with a repair that falls outside either the covered warranty terms or the warranty period is $199 for a 4 GB model and $249 for an 8 GB model. If just the battery needs to be replaced, that's a separate program that costs $85.95 ($79 plus $6.95 shipping). Battery replacement and other services take about three business days. I expect Apple will send out a lot of refurbished iPhones in favor of repairing purchased iPhones given the amount of soldering on the iPhone; see iFixIt's tear-down.
Most people can't be without a phone for three working days (which might mean five or six over a long weekend). Apple has a deal for you: the Apple Service Phone, a $29 rental that lasts until a few days after your iPhone is repaired.
The rental phone must be returned 7 days after you receive a repaired phone back by shipping service, 5 days after your phone is ready for pickup at an Apple Store, or 10 days after it's sent if you fail to send your broken iPhone in at all. There's an extra $50 charge if you return it late, and a $600 reserve placed on your credit card that's turned into a charge if you fail to return it within 10 days of the end of the loan.
The SIM (Subscriber Identity Module) card that's used to identify your account uniquely can be removed from the iPhone by poking a paper clip into a hole at the top of the iPhone. That SIM card can be swapped into the rental phone before you send back your own model for repair. If you send the SIM card in when you return a rental phone, you have to contact AT&T to get a new one.
Apple also offers a page of tips on conserving and extending battery life.