Apple's iPhone is driving "unheard of levels of mobile internet usage," an O2 executive said today.

Apple's UK network partner today announced the launch of the first major trial of femtocell deployments in the UK. The company is working with NEC and Ubiquisys and hopes for a commercial launch of the technology- which improves 3G coverage when indoors - by early 2009.

Femtocells are designed to improve indoor 3G mobile-broadband coverage by re-routing data from cellular networks and onto wired DSL connections, building cellular coverage from the inside out.

If successful, the trial will be rolled out to up to 500 users across the UK in the summer.

Vivek Dev, chief operating officer of Telefónica O2 Europe, said: "Our Apple iPhone is already driving unheard-of levels of mobile internet usage, and the introduction of flat rate data tariffs is expected to increase this further. Both of these place huge capacity demands on our networks, and because so much of that usage is at home, femtocells coupled with DSL could provide an alternative capacity resource."

He stressed the potential of the new technology: "This technology has the potential to support increased growth in the usage and consumption of services and data and could play a crucial role in underpinning the explosive growth of mobile broadband usage."

News of the trial in conjunction with intimations of the impact of iPhone on data traffic is likely to drive a further series of 3G iPhone rumours.