Iphone 1st gen vs. 2nd Gen, worth the upgrade?

Hi all. I have to switch from T-Mobile USA to AT&T due to lack of signal in my new apartment from T-Mobile. AT&T works great but I'm sad to lose the wonderful plan I have with t-mobile. Anyway, I am curious what you all think I should do. Should I:

1)Keep my 1st Generation Edge Iphone and get sign up for AT&T with no contract


or

2)Upgrade to 3G 2nd generation Iphone and sign a 2 year contract


Any perks to upgrading? I'd love to hear how people feel about them who have owned both. Also, any ideas as to when the 3rd generation will be released and what features it could have? Maybe I should stick with 1st genereation and upgrade once the next version is out. Right now I'm leaning towards getting the 3G to have a little extra speed and since it will have a new battery. I'm sure with all the use of my 1st gen, i will need a new battery within 6 months. The upgrade for that reason alone could be worth it. Thanks for your thoughts.

well I heard the the 3rd version of the iphone will be out in summer 2009 around June maybe.