With the announcement of the new iPhone 4 there is a lot of confusion about what is 3G and 4G.  Here is a great video which explains the evolution of the technology and what AT&T, Verizon, T-Mobile and Sprint use on their networks.  The first iPhone 3G used a technology called EGDE and the new iPhone 4 is using the the HSPA technology.  Here are the protocols explained so that when someone says they have a 4G iPhone you can correct them.

Generation - Definition - Technologies - Speeds
1G - Original analog cellular for voice (AMPS, NMT, TACS) 14.4 kbps
2G - Digital narrowband circuit data  (TDMA, CDMA) 9-14.4 kbps
2.5G - Packet data onto a 2G network (GPRS, EDGE) 20-40 kpbs
3G - Digital broadband packet data (CDMA, EV-DO, UMTS, EDGE) 500-700 kbps
3.5G - Replacement for EDGE is (HSPA) 1-3 mbps
4G - Digital broadband packet data all IP (Wi-Fi, WIMAX, LTE) 3-5 mbps
5G - Gigabit per second in a few years (?) 1+ gbps