If you’re one of the old school who bought your iPhone on an O2 contract, a word of warning before you upgrade – check the small print.

Avid Bitterwallet reader Dominic has been in touch to let us know that you won’t get what you expect from O2’s new improved “unlimited text” tariffs:

As a subscriber of the old £35 a month tariff (600 mins and 500 texts) I thought it was a good deal to change to their £40 a month for 600 mins and ‘unlimited’ texts… but there’s a catch.

At the moment on the £35 a month tariff you can text an international number or send a picture message and it comes out of your 500 message allowance. With a new ‘unlimited text’ tariff you have to pay extra for picture messages and international texts. This wasn’t explained to me and so I cancelled my ‘upgrade’ on the subsequent phone call.

We’ve had a check and it’s now 20 pence per MMS and 16 pence per international text. Even if you stay on the same tariff, you’ll still find yourself with the new ‘unlimited texts’ alternative and having to pay for texts that were included in your allowance. Having said that, if you’ve finished your contract you might be better off looking at O2’s Simplicity deals – instead of £40 per month for two years, you pay half the price for half the contract length.

Yes, we’re a day late with this one, but we spent most of yesterday kayaking as part of a team-building exercise. Honest.

O2 have declared themselves as “the home of the smartphone” with their upcoming exclusive launch of the Palm Pre (left) on October 16th. You could even go so far as to call them smart arses if you like.

In truth, O2 have had to go out all guns blazing to get an exclusive on the Pre as it is set to be the major smartphone rival to the iPhone, and the pricing plan revealed yesterday is iPhone-esque to say the least.

The Pre handset will be free to customers who sign up to a 24-month contract costing for £34.26 per month, which will include 600 UK minutes, 500 UK text messages and unlimited downloads.

Then there’s the 18-month contract – fork out at mammoth £73.41 per month and you’ll get a free Pre and a larynx-crushing 3000 UK minutes. There’ll also be 500 UK text messages and unlimited downloads.

An alternative 18-month contract will set you back just £29.38 per month but the Pre handset will cost you £96.89

Business tariffs will also be available on 24 or 36 month contracts and there’s still no news about Pre pay-as-you-go.

The Pre features a 3.1-inch touch-screen display, a slide-out Qwerty keyboard, a three-megapixel camera, push email support and high-speed internet access via 3G and Wi-Fi.

As our Paul said a couple of months ago, it’s going to be fascinating to see how O2 handle the fact that they’ve got exclusives on two competing smartphones, particularly as it’s widely believed that the Pre has to be a success if Palm is to survive. Maybe they’ll pick up disgruntled iPhone early adopters who want to try something new.

Let us know what you think of the Pre, and if you’d be tempted to invest in one. Or maybe you’ve got your eye on the Android-powered HTC Tattoo (pictured right), which is exclusive to Vodafone and has appeared as a pre-order on their website. As yet, there are no pricing details so it’s only getting this poxy paragraph at the end of the Pre story. Nyah nyah!

Time for an upgrade?

There’s a new mobile phone tariff comparison site here in Internet Town, and it’s got the thumbs up from the stiff shirts at Ofcom. It goes by the name of BillMonitor and claims to be able to find you a more cost-effective tariff just by looking at your birth date, shoe size and the name of your favourite character from Home And Away.

Actually, that’s not true. But all BillMonitor does need is a brief outline of your current monthly usage, and hey presto, it’ll do its bestest to fix you up with a better deal. Plus, as we said, it’s been approved by Ofcom, and is the first mobile comparison service to get their seal of approval.

If you’re happy to give it your current online billing info and let it root around in the finer details of your monthly usage, it’ll provide a much more detailed set of recommendations – to date BillMonitor claims that 82% of the site’s users were found to be on plans with inclusive minutes they don’t use. In fact they discovered that users could upgrade to an iPhone for just £2.70 more per month than they were currently paying.

Feel free to fill in the comments box below with your rabid pro and anti-iPhone noise…

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