[scudder]

When you buy an iPhone from O2 it comes with a sim card in it that is not activated. They don't care if you have a contract at the point of purchase because they believe you are going to log onto the internet using itunes and set up your contract with O2 that way. You can choose this route if you wish to take out a £35 a month deal OR you can unlock it yourself using one of many free programmes on the internet, search my friend! After that the choice of operator is up to you. PAYG or monthly but note that PAYG doesn't always give you data plan access.