O2 joins iPhone 4 pay-as-you-go party

O2 has followed in the footsteps of rival network Vodafone by offering the Apple iPhone 4 on pay-as-you-go (PAYG).

The network is charging 495 up front for the cheaper 16GB iPhone 4, or 595 for the 32GB model, only slightly undercutting the 499 and 599 respectively Apple itself is selling the handset for unlocked.

O2's prices are also 15 and 25 respectively more expensive than Vodafone's deals, though you do get 300 texts and 500MB of internet use free when you top up 10 per month through O2.

Vodafone, by contrast, provides only 250MB of 3G mobile internet a month (for a minimum 7.50 per month top up), though it does offer 1GB of BT Openzone WiFi use as a sweetener.

So far O2 and Vodafone are the only two networks to sell the iPhone directly on a PAYG basis, though Orange and Three do offer micro-SIM-only deals for those already in possession of the handset itself, while T-Mobile says its iPhone PAYG is "coming soon".

However, for many buyers the deciding factor will not be price, or the monthly data bundle, but availability. Vodafone's PAYG iPhone sold out within 24 hours at present the online ordering system simply tries to lure you in with the generic message "our goal is to deliver within 2-4 business days", while even Apple itself is quoting a three-week turnaround time.

O2, meanwhile, claims to have both the 16GB and 32GB PAYG iPhone in stock for now, at least.