Apple Chief Operating Officer Timothy Cook has said that most phones sold - or given away for nothing - aren’t worth the paper you sign your 12 month contract on ; but that the $500 iPhone will be worth every penny.

"A lot of people pay zero for the cellphone. Guess why ? That’s what it’s worth," he told attendants at the Goldman Sachs Group technology conference, referring to the trend of giving people phones for little or nothing in order to get them to sign on for a fixed period.

If we offer something that has tremendous value, that is sort of this thing people didn’t have in their consciousness - it was not imaginable - then I think there’s a whole bunch of people that will pay $499, $599 [for the iPhone]." He rejects direct comparison to other products in the phone category, with his argument revolving around the original $399 iPod :

"That kind of analysis doesn’t make really great products," Cook said. "The iPod would not have been brought to market if we would have looked at it that way - how many $399 music players were being sold at that time ?"

This comes after a survey by market research firm Compete concluded that most consumers wouldn’t pay anything above $200 - $300 for the iPhone.

Music to fanboys ears... Meanwhile, on eBay, you can pick yourself up "a papercraft Apple iPhone with a fully charged battery in it, in a brown box I got from Apple Sacramento. The iPhone doesn’t come out until the summer, so have fun playing around with this, impressing your friends !" Yours for only $152.50 at the current bid.

If my mother were here I think at this point she’d tell me something about starving children or homeless people.