CHESHUNT, UK - On Monday 14th December, Tesco will start offering the iPhone for a £20 (US$33) monthly payment for a 12-month contract which includes calls and text messages for £60 (US$98) and unlimited internet connection.

The start cost of each unit in prepaid would be £222 (US$361) for the 8GB iPhone 3G, £320 (US$520) for the 16GB iPhone 3GS and £407 (US$662) for the 32GB iPhone 3GS.

Despite of having an initial cost, Tesco offers the option of getting a free handset (initial cost zero) with unlimited calls, text and web on a 24-month contract of £60 (US$98) per month. Only the 8GB iPhone 3G or 16GB iPhone 3GS are available through this option. For the 32GB iPhone 3GS a £50 (US$81) surcharge is required.

Lastly, the pay-as-you-go option is available, as well getting a triplicate credit, for example, credit of £15 (US$24)  receives an extra £30 (US$49) free; and unlimited internet connection. However, the initial cost here is more expensive than the first option described, being £342 (US$556) for an 8GB iPhone 3G (a handset that is now 18 months old), or £440 (US$716) for the 16GB iPhone 3GS, and £538 (US$875) for the 32GB iPhone 3GS.

[£1 = US$1.62606]