UK based Mobile website is reporting that O2 will tweak the pricing of the iPhone in May, ahead of a new iPhone in June or July.

According to Mobile the iPhone 3G which is currently between £59 and £159 upfront will drop to free on tariffs of £35 and £45.

The report goes onto mention that Orange is in talks with Apple to allow the iPhone to be available from both O2 and Orange in the UK. Orange currently sells the iPhone in 27 other countries including France and Poland.