O2 has confirmed its UK price tariffs for the iPhone 3G - and they're in line with those we reported last week.

O2 and Apple today will ship the iPhone 3G in the UK and Ireland on July 11 - the day it ships in 22 countries worldwide.

New iPhone customers can purchase the 8GB model for £99, or the 16GB model for just £159. You can then sign up to a regular £35 contract (600 minutes, 500 texts per month), or a new £30 contract (75 minutes, 125 texts).

Customers signing up for the more expensive tariffs will get the iPhone for free. New users signing up to a £45 per month contract (1200 minutes, 500 texts) get the 8GB phone for free or can get the 16GB iPhone for just £59.

Users signing up to the £75 per month contract (3000 minutes, 500 texts) get the 16GB model for free.

Existing iPhone customers on the £45 per month contract will be able to upgrade their existing model to the new 8GB iPhone for free on July 11 by visiting the O2 Website. As we reported, you will need to sign up for a new 18 month contract. Existing customers on the £75 per month contract will receive the 16GB iPhone for free.

Current iPhone users on the £35 per month contract will be required to pay £99 to upgrade to the new handset and sign up for a new 18 month contract. They can, however, move up to the more expensive £45 per month contract and get the iPhone for free.

O2 has confirmed that existing iPhone customers will be able to keep their old iPhone. This can be handed on to another person who can sign up for a contract with O2.

All tariffs include unlimited browsing on your iPhone, unlimited Wi-Fi access to The Cloud and BT Openzone, visual voicemail and reduced roaming rates with the International Traveller Service (£3 per 1MB in EU countries, £6 per MB outside of the EU) and are subject to a minimum term contract of 18 months.

O2 has also announced a Pay & Go deal, although the company has not revealed yet any information as to how much the iPhone handset will cost. Customers interested in this deal are being asked to register their interest on the O2 website. More information is promised in July.

Customers will also be able to keep their existing iPhone after they upgrade: "If you've a friend or family member already on an eligible O2 tariff, they'll be able to transfer to one of our new tariffs for iPhone. If they're not already with O2 or on an eligible O2 tariff, they could get one of our new iPhone Pay & Go SIM cards."

Details of the new iPhone Pay & Go offering haven't yet been announced, customers interested in signing-up to it should register on the O2 website to be furnished with more details on the offer when the iPhone ships.

“The iPhone has been a phenomenal success for us,” said Matthew Key, chairman and CEO, Telefónica Europe. “We look forward to offering an ever better iPhone 3G experience exclusively to our customers in the UK and Ireland.”

Business customers are also being offered deals on the iPhone, which is free on selected business tariffs. (The small print: "8GB handset provided at no additional cost to primary users on tariffs above £26.25 (excluding VAT) when you connect to a new minimum term contract with iPhone Bolt On."

Business tariffs enable users to have several iPhones and other devices on one business account and all on the same bill. They also allow business customers to share the inclusive minutes and texts across all users and include unlimited calls to any O2 mobile, as well as unlimited calls to ten UK landlines. More information on business tariffs is available here.

The Carphone Warehouse will be the only independent mobile phone retailer to be stocking the handset when it is released in the UK.

Charles Dunstone, CEO, The Carphone Warehouse said: "The  iPhone 3G is a massive step forward for mobile internet. The iPhone continues to lead the pack and now customers will have fast, simple access to true internet on the move. It's rare for a mobile phone to cause global excitement but iPhone sets the standard for others to follow. I'm delighted that we'll be offering the new iPhone 3G for free on a contract. We're expecting a huge demand when it goes on sale across our 800 stores on 11 July and there are some great upgrade offers for those that have previously bought an iPhone on the O2 network."