Word on the Web is spreading that O2 is doing a £20 per month SIM-only iPhone contract. Now before anyone passes out, there's a bag full of circumstances and it won't be available to all, but it does indeed seem that it's an entirely possible deal to achieve.
If you already have an out of contract iPhone on O2, then you can sign up to "Simplicity 20 for iPhone" - a 30-day rolling contract with 600 minutes, 1200 texts, Visual Voicemail and unlimited web and Wi-Fi each month. You can also get the deal if you have an iPhone of your own from another network but with 800 minutes, 1600 texts, the unlimited web bolt-on but no Visual Voicemail and no access to the Cloud and BT Openzone hotspots. Either way, it's a cracking deal.
According to Know Your Mobile and a number of O2 discussion forums, the deal isn't advertised, but some of the telesales staff - particularly in the customer retention team - have been instructed on the offer. The idea is to keep iPhone users who are waiting until the fourth generation handset to come out this summer before upgrading.
If you're interested, then call them up - a few times if necessary - threaten to leave the network, get yourself passed on to the retention team and fish around for "something that might persuade you to stay". You know the routine. Good luck and let us know how it goes in the comments below.