Apple:

MMS (Multimedia Messaging Service) is now available to AT&T customers.

AT&T MMS requires iPhone OS 3.1 and a carrier settings update.

Here's what it looks like (on a Mac) ...

Unlike other iPhone updates I've installed via iTunes, this one is actually very quick. Very quick. On the other hand, you do have to hard reset the iPhone to enable it. Once it's rebooted, which takes more time than booting a PC, you can use the standard Messages app to send one or more photos with a text message. You'll see the following new toolbar above the virtual keyboard:

Photos have to be added one at a time, which is no big deal. (But I wish Apple would drop the awful iChat-like "thought bubble" UI in this SMS/MMS app. It's just childish looking.)

Needless to say, this being Apple and AT&T, the complaints have already begun rolling in. I'm sure they'll get it right eventually.