O2 has announced that from 3 April it will introduce a new 24 month tariff option for iPhone customers that will see iPhone 3Gs given away for "free" on lower tariffs then ever before.
Following AT&T's introduction of a "commitment-free" iPhone in the US, this will fuel speculation that the operators are attempting to clear down stocks of the phone in anticipation of a new model rumoured for launch this summer.
O2 says the new tariff is for those "looking for added value in return for added commitment".
Customers who sign up to the 24 month tariff can get the 8GB iPhone 3G for free at £34.26 per month and the 16GB iPhone 3G for free at £44.05 per month.
Previously the iPhone 3G 8GB was available from free only on £44.05 a month contracts while the 16GB iPhone was free only on a £73.41 a month contract.
The 24 month iPhone 3G tariff will be available through O2, Apple and Carphone Warehouse from 3 April.