If you already have an iPhone on AT&T, check your account on their web site. Mine says i will be eligible for an upgrade next month, and the date is about a year after I first bought the previous model. No word yet about upgrade price. There is, however, a statement elsewhere that if you already have a contract you can get the new model at the announced price with your contract running two years from the start, not the end of the old contract.
So clearly AT&T is planning to offer something to existing iPhone customers who want to upgrade. I'm sure they'll figure out the full details before the July 11 rollout.
As to the many discussions about "should I upgrade?", the big improvements are iPhone software 2.0 and Apple's upgraded dot mac aka "me.com", and both will work fine on existing iPhones after July 11. If 3G and GPS are worth the extra cost of both upgrading and paying an additional $10 a month for 3G speeds, by all means upgrade; if not, don't, but don't whine about it; rocks are hard, water is wet, and the 3G iPhone and AT&T are what they are