(£19.58 p/month on a 12 month contract w/£100 cashback from quidco)http://store.apple.com/uk/browse/home/shop_iphone/family/iphone?mco=OTM4MTE1MQ
(iPhone 3GS 16GB for £440.40 with around £17 cashback)
For £797 (after cashback) for 24 months you can get an iphone 3GS 16GB from the apple store and a sim only contract from the O2 store that includes 800 minutes a month and 1600 texts a month as well as "unlimited web bolt on" which I understand to be 200MB's of data transfer per month in the united kingdom which should be sufficient for daily web browsing and email checking and such.
To get this deal you must use http://www.quidco.com
to purchase the sim only contract from O2 and the iphone 3GS from the apple store separately.
To clarify, O2 offers an iphone 3GS for £35 a month with a one off £87 charge for the phone which provides you with 600 minutes and 500 texts a month whereas doing it separately through quidco can get you the phone for "free" for the equivalent of £33.20 a month with 800 minutes and 1600 texts and month.
Just to clarify I'm not saying you can get a free iphone 3GS for £33.20 a month, I'm saying you can get it for the equivalent of £33.20 a month based on 2 12 month contracts.
This doesn't even begin to include the savings you may be able to make while negotiating with O2 before your 12 month contract ends.
Also, if you do it by the end of this month you get an O2 money card with £10 preloaded on it. Whatever that is >_>;