O2 customers who choose a service plan that comes in at either $88 or $146.50 a month would end up getting the 8GB model of the 3G iPhone version for free.
The iPhone will be offered for free with a catch basically from O2.
On Monday, Apple CEO Steve Jobs announced the launch of the 3G iPhone, which will retail for $199 in the 8GB model, and $299 in the 16GB model.
Those who want to get a more expensive service plan from O2 would actually be able to get the 16GB 3G iPhone for free as well.
Ronan Dunne, chief executive of O2 in the UK stated “iPhone quickly became our fastest selling device and with this new pricing, iPhone 3G is an unbeatable proposition.”