Uni’s Blog

When he unveiled the next-generation iPhone on June 9 in San Francisco, CEO Steve Jobs made it clear that he’s determined to turn Apple (AAPL) into a much bigger player in the mobile-phone market. Among other things, he slashed the price for the entry-level iPhone to $199, half that of the previous edition and right in line with what competitors’ high-end phones cost. The move seems certain to attract new customers, especially consumers who had been turned off by the higher price. “Everyone wants an iPhone,” Jobs said. “But we need to make it more affordable.”

U.K. wireless carrier O2 said Tuesday it would offer Apple’s latest iPhone for free with some plans.

Apple chief executive Steve Jobs on Monday introduced the newest version of the smartphone, which supports wireless carriers’ faster 3G cellular networks, at the company’s Worldwide Developers Conference in San Francisco. Along with introducing new features to make the iPhone more usable for businesses, Jobs also dropped the price for the base model from $399 to $199.

O2 customers who choose service plans costing either $88 or $146.50 a month would get the 8-GB version of the iPhone 3G at no additional cost. The 16-GB version of the iPhone would also be available at no charge with the more expensive subscription plan. For businesses, O2 plans to offer the device at no charge for companies on a 24- or 36-month contract.

Apple announced on Monday a much faster iPhone that’s half the price of the current model.

The news is expected to address one of the biggest complaints about the hugely popular iPhone: That its Internet browsing is too slow. CEO Steve Jobs said the new iPhone, which is based on 3G technology, is 36% faster than top rival Nokia’s N95 smartphone.

As Fortune.com first reported, the new 8-gigabyte iPhone will cost $199 and a 16-gigabyte version will cost $299. Jobs says the new iPhone will be available worldwide starting July 11. It will allow up to six hours of Web browsing and five hours of talk time.

Jobs announced the 3G iPhone, which had been rumored for months, at the company’s annual World Wide Developers conference in San Francisco.