O2 unveil pay as you go iPhone tariffs in the UK, the new 3G iPhone will be available from £299 for the 8GB model and £359 for the 16GB on PAYG with calls costing 5 pence per minute.

Customers who spend a minimum each month on calls will be allowed to choose from several plans which add free features on top of their normal calls. Those spending from £10 – £14 per month on calls can get 500 minutes of bonus call time when the iPhone is used from a registered postcode, they can also choose 300 free SMS messages from within the UK, evening and weekends package that adds 50 of free calls regardless of area, unlimited o2 to o2 SMS or 100 minutes of international calls from the UK.

Spending more gets you additional time, for instance customers spending £30 per month qualify for either unlimited free calls from a fixed location and between O2 customers, unlimited UK messages, up to 300 minutes evenings and weekends or 200 international minutes.

Prices above include unlimited browsing and Wi-Fi for the first 6 months after which the customer is notified by text and is required to spend an additional £10 per month to maintain the unlimited data. Customers also have the option of unsubscribing after the 6 month period should they wish to do so.