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.

"iPhone quickly became our fastest selling device ever and with this new pricing, iPhone 3G is an unbeatable proposition," Ronan Dunne, chief executive of O2 in the United Kingdom, said in a statement.

O2 plans to start offering the new iPhone on July 11, which is the release date set by Apple.

In introducing the iPhone 2.0, Apple has added features that attempt to make the device desirable for businesses, as well as consumers, who account for most of the 6 million iPhones sold so far.

Key to the strategy of driving the iPhone into business are new development tools for building applications that run natively on the iPhone's operating system. Features added to the OS for business include full-support for the popular Microsoft Exchange e-mail server, support for network security standards, automatic discovery of the device within network management software, and the ability to remotely wipe out data on a lost or stolen iPhone.