Nah, well, I only got my iPhone 3G on Pay and Go a good few months ago. I am more than happy with it. And haven't experienced any issues, or at least on O2's end as far as network coverage is concerned. Then again I haven't really strained it or travelled miles using it.
As far as price is concerned I don't see an issue. Contract isn't that bad (from what I have looked at) and the iPhone is the best phone I have had, hands down.
I may switch to O2 simplicity. I honestly didn't know it was only £11 for all that. Anywho.
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