When the iPhone launched, Apple said that the battery would start to "lose capacity" after about 300 or 400 charges. However, the company is referring to charge cycles, which is basically a completely drained battery then charged up fully. Apple defines proper maintenance as "at least one charge cycle per month." Also, the battery won't be completely useless after 400 charges. Apple's website says that the battery will retain up to 80% of its original capacity at 400 full charge and discharge cycles.
The one year warranty covering the iPhone (can be extended to two years for $69) entitles the owner to a free replacement battery if it drops below 50% capacity too.
Source:
News.com