O2 scraps unlimited mobile data deals

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It's a sad day for many iPhone users as O2 has announced that its unlimited mobile data allowance is no more.

Instead, the mobile giant will offer new and upgrading users 500MB - 1GB inclusive per month depending on their contract. Additional data can be paid for in blocks once that allowance has been exceeded.

The news comes in the same week that Apple unveiled iPhone 4, which is expected to prove as popular as previous generations when it hits the UK on 24 June. The data charging changes will kick in on the same day as the iPhone 4's launch for O2 customers either signing up for the first time or upgrading, but they can continue to feed their data usage habits on a cap-free basis until 1 October as part of a promotional deal.

"By doing this, we are laying the foundation for a sustainable data experience for all customers and the huge possibilities that technology will create over the coming years," O2's chief executive Ronan Dunne said in a statement issued today.

O2 claims that this new pricing structure offers a "more transparent pricing model tied to usage" but many data-hungry iPhone users, used to their cap-free lives, may not agree.

“We know that customers are looking for clarity in pricing as too many offers have clauses and catches which are not easy to understand. With the wide range of Internet based services now available on mobile devices we’re providing customers with generous clear data bundles that give customers freedom," Dunne claimed.

"This enables us to provide a better overall experience for the vast majority of customers and to better manage demand.”

If you take into account the way O2 iPhone users currently use their devices, the majority (97 per cent) of them wouldn't need to fork out additional money for data going forward, according to O2.

It reckons that the 500MB bundle delivers more than twice the amount its users currently consume.

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