Photos: Steve Jobs and the UK iPhone launch

O2 is investing in its network to support the wi-fi capabilities of the iPhone and says it will have 30 per cent Edge coverage by the launch of the phone.

The operator's UK CEO Matthew Key (above left, with Jobs) said: "We are confident that we will sell a significant number of iPhones." But neither Apple nor O2 would give details of the financial arrangement behind the deal. Key said O2's own research suggested 80 per cent of their high value customers would like the phone, and 40 per cent of customers on rival networks would switch to get their hands on the device.

This is in line with exclusive research by silicon.com which found that one in three readers polled would be willing to switch networks to get hold of the phone.

Photo credit: Steve Ranger

Apple has already sold one million of the phones in the US.

There had been long-running speculation about which operator would offer the iPhone in the UK, and Jobs (above) responded to a question about how the other UK networks felt about the negotiations by saying: "We dated a few people that we didn't marry and then we found someone we wanted to marry and we did. So there's a few upset girlfriends out there. It wasn't an economic choice it was a cultural choice."

Photo credit: Steve Ranger

Jobs also said that 3G chipsets are still too power hungry to be used in the iPhone: "Right now you make a really big trade off going to 3G - and that's really bad battery life."

Instead, he pointed to the wi-fi capabilities of the device: "The one thing you do that you would like to go faster is the internet so what we did was rather than cut the battery life we built in wi-fi which is way faster than a 3G network."

He also refused to rule out future price cuts for the gadget - such as the ones which upset early iPhone adopters in the US - saying there are "never any guarantees" in technology.

Photo credit: Steve Ranger