iphone 3gs upgrade options

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My wife is hoping for a new iphone for Christmas or thereabouts
She currently has an iphone 3gs, and the iphone 5 seems a reasonable upgrade given the change in screen and specs, costly though.

She is currently on an o2 simplicity deal, which charges 16.50 a month, for calls texts and 500mb data, and ak and ireland bolton which gives texts to ROI afaik.

What are her options to stay with o2, but upgrade to the iphone 5, preferably keeping her current number?

 

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I'll have to have a look, i assume with O2, she doesn't actually have any upgrade path with them, as it is a simplicity account, or pay and go, or wahtever they call them, so maybe moving might be a better option.

 

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Apples website seems to suggest that the new iphone will lock to the network of the sim first used within it?
Does this mean you cannot switch if you buy a simfree phone, then chnage your mind?

As for transferring messagea and contacts and allmthat jazz, can you do that at home on itunes, or will the guys in a store do that for you when you buy a new one?

 

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No.

Unlocked phones are just that: unlocked.

Please note: iPhone will lock itself to the network of the first SIM card that is used in the phone. Subsequently attempting to use it on any other network, for example by replacing the SIM card, may mean it becomes permanently unusable. SIM free iPhones can only be used with a UK-network SIM card, and will not accept foreign SIM cards.

Is this wrong then?