Original iphone works but can no longer be activated for phone use????

I have one of the original iphones that works but I no longer use (as in I paid $700 for it when it first came out). I just gave it to my nephew and my brother tells me Apple and ATT don't support it and he's being told that it can't be set-up as a functioning phone? That the current version of itunes won't support it either? Does this make sense to anyone? Could this be true? I'm on my 3rd iphone version and the first 2 work I just upgraded so now the old phones can't be used? I gave the same nephew a much older flip phone that still works and it has phone service.... Thoughts?

This doesn't make any sense to me either. Are we missing some vital information or is he just mistaken?
Until this last November, I was using a Blackberry Curve. I was visiting a friend and complained about the trackball giving me fits. He went to his kitchen junk drawer and pulled out his very first iPhone 2g and tossed it to me. I've been using it ever since without issue.
If the phone is in proper working order, it should only take a call to AT&T to order an appropriate plan and sim card. The original iPhone is still fully supported by AT&T and iTunes. While iOS support does end with version 3.1.3 and more and more apps do require iOS4, it still affords a very reasonable user experience. So reasonable, in fact, I am reconsidering my original plan of upgrading to the iPhone 4 this month. What can I say? It kicks BB Curve behind and does everything I need using a sweet grandfathered calling and data plan! laugh

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