O2 to Launch iPhone in the UK

Mobile operator O2 is set to announce that it's beaten rival Vodafone to win the U.K. contract to sell Apple's iPhone.

Several reports this morning claim O2 will have the iPhone on sale in the U.K. before Christmas for either #300 (US$605) or #399. Apple's iPhone -- which went on sale in the U.S. last week -- ships with either 4GB or 8GB of storage.

Speculation about European iPhone operators has been rife since Apple announced the product earlier this year and then revealed that it would stick with just one mobile operator in each country.

T-Mobile looks set to win the contract in Germany, and had been suggested as a pan-European Apple partner. However, Vodafone was said to be leading the race in the U.K., until this morning's reports of the Apple and O2 tie-up.

Apple is likely to be pleased with the iPhone launch in the U.S. -- it's already sold 700,000 units, according to one report, while early reviews have been positive.

However, as expected, hackers have also made the news this week, and have already been successful in cracking the iPhone/iTunes activation tie-in. They claim to be well on the way to fully unlocking the iPhone in the U.S. so iPhone buyers no longer have to use the phone on AT&T's mobile network.