The package, which sees the cost of a 3GS 16GB handset tumble from £320 to £200, includes unlimited texts and 750 minutes of calls.

Tesco’s price crash comes just four months after it put the iPhone into stores – and the chain’s telecoms boss Lance Batchelor reckons the Apple gadget is just about to become even more affordable.

He says: “Tesco Mobile’s iPhone tariffs have been very popular – we’ve now made them even better.” Direct comparisons are difficult as rivals like O2, Orange and Vodafone don’t yet offer year-long iPhone contracts.

Vodafone has a two-year contract for a 3GS 16GB iPhone for £89 on a £35 monthly package with unlimited texts and 600 minutes of talk time. O2 offers unlimited texts and an 18-month deal for £35 a month, with 300 minutes of talking – but the handset is dear at £249.

Orange has an 18-month contract for £35 a month offering a handset for £189 but texts are limited to 500 a month and there’s 600 minutes of speech.

Basically, the longer and dearer the contract, the less the handset costs… unless you pick up a bargain from an auction site (£99, say) and use a SIM-only tariff.

Resource:
http://www.mirror.co.uk/advice/money/2010/04/14/prepare-for-an-iphone-price-war-thanks-to-tesco-mobile-s-new-12-month-deal-115875-22184008/