Even though Google said that T-Mobile G1 only supports up to an 8GB microSDHC card, with future support for the 16GB version after a firmware upgrade, that's not the case. We just got confirmation from Google spokesperson that the current version of Android can handle the new SanDisk 16GB card right out of the box.
"We have completed tests, and the new SanDisk 16GB card will run on the current version of Android. No new firmware required." -Google Spokesperson
SanDisk's 16GB microSDHC card has an MSRP of $99.99 and will be available at Best Buy Mobile stores in October and Verizon Wireless stores in November - the only major retailers in the United States to carry this mobile storage capacity in 2008.