I got an iPhone the very first day it came out. Failed the credit check, so I got one of the rare prepaid plans, with unlimited EDGE for only $20/mo.
I really intended it to last a lot longer than it did, but it broke down about 2 and a half years later (part of the touch screen stopped responding to touch), so I got an iPhone 3GS, with AppleCare. I had to sign up for a contract though and pay more money per month. Fortunately my credit had improved dramatically since then - I got the first one when I was 18 and didn't even have a credit card.
A little under a year after I got that, it also had two problems (bad silence switch, and dust under the glass) - but I got a free swap under warranty. Hopefully I can make this one last a few years.
I'm not one who upgrades for the sake of upgrading - I believe in trying to get some value out of something first. It's a bit of a status symbol, sure - but it's also a tool for me.