Mobiles.co.uk is offering an iPhone for £16 per month on a two year contract. There are two caveats though; the phone is an iPhone 3GS, which was launched in June 2009. It is a refurbished model that comes with one year manufacturer's warranty but a different box to the original.
As for the contract, you get 200 minutes, 100MB data and unlimited texts. The total cost of ownership of the contract is £384 while the SIM Free version of £319, which means that the cost of the contract itself is £65.
The phone is still quite powerful. It sports a Samsung S5PC100 which is a 600MHz single core ARM-based Cortex A8 processor with a PowerVR SGX535 GPU, 256MB RAM and 8GB onboard storage. The screen is a 3.57in capacitive one with a 480 x 320 pixels resolution.
The iPhone 3GS comes with a three megapixel camera with VGA recording capabilities but no front facing one. It still runs on iOS 5.1.1 even though it is three years old (which is great given that Android smartphones that old won't even do Gingerbread, let alone Ice Cream Sandwich).
For roughly the same outlay, you can also get the Xperia U, which is a dual core smartphone, with a 3.5in display, 4GB internal storage and Android 2.3 Gingerbread.
Source : Mobiles.co.uk