O2 announced their plans for the iPhone 3G yesterday, revealing that the iPhone 3G will be fully subsidized (free) for certain rate plans:
*Best of all, the new 8GB iPhone won't cost you a penny on our 45 and 75 tariffs. And it's just 99 on our 35 tariff and new 30 tariff.
All tariffs include unlimited browsing, free Wi-Fi, visual voicemail and require an 18 month contract. For existing iPhone owners who wish to upgrade, the 18 month contract replaces your current contract rather than adding onto it.