The interesting thing this year started with Nokia’s E71x on AT&T–a full fledge smartphone for $99 on contract after rebates. Then, the Samsung Jack followed the pricing convention, also on AT&T. The State’s largest GSM carrier is about to shake things a bit further with another $99 handset in the mix, and this time they are teaming up with Apple to deliver the 8 GB iPhone 3G (last year’s model) at that price. While those on the cutting edge on the mobile front will dismiss the low iPhone pricing because it’s last year’s model, but in reality, the iPhone 3G will receive the latest iPhone 3.0 operating system upgrade, bringing many of the new features (not all) of the newly announced iPhone 3G S to its older brother.

That said, a $99 touchscreen phone makes the iPhone an even more attractive purchase. Windows Mobile Standard devices already see that price point, but can it happen with a Windows Mobile Professional device? Would you be more inclined to consider a Diamond if Sprint released a Windows Mobile 6.5 upgrade for $99 now that the Diamond2 has been announced and will be coming shortly? Keep in mind, the upgrade will almost take you to the level of the newest hardware–the Diamond2 in this case–but some features may not be there or may require newer hardware components.

The $99 price point with many of the “smartphone” features that iPhone OS 3.0 hopes to bring makes it a compelling choice, especially compared to more expensive platforms. To the general consumer, the $99 iPhone undercuts the Palm Pre (also at 8 GB for $300, $200 after rebates) and Windows Mobile devices like the Diamond and Diamond2, which also utilize a similar touchscreen form factor.

Since HTC is the largest maker of Windows Phone, it has the greatest chance of being able to reduce costs and offer an innovative product a low price point due to economies of scale. On a similar note, a year from now when HTC announces a Diamond3, would you want a Diamond2 with a potential to upgrade to the latest available ROM for the low $99 price? Perhaps the real question is will you settle for older hardware and some newer software features for a lower price?