To clarify ansy's post, the only iPhone that was released with iOS 4.0 installed by default is the iPhone 4.0. The only way to perform an OS upgrade with the iPhone is to do a device sync. If iOS 3.0 has been mostly eliminated, that means that the iPhone 4 must command at least 50% of the iPhone market -- probably much more. Given the amount of iPhone 3GSs that I regularly see, this seems a little far-fetched to me. Thus, someone's information is wrong somewhere.