If you think that paying $500 (£399) for the Apple iPhone was expensive, things could be about to get dearer still. US mobile network AT&T is set to sell the mobile phone on Pay As You Go (PAYG) - something that could see the initial purchase price soar through the roof.

Details are pretty sketchy at the momen. The info comes from The Boy Genius Report, who have some screenshots , allegedly showing the phone on pre-pay or PAYG from AT&T.

The screengrabs suggest that the iPhone will be available on prepaid tariffs as well as on contract. This is contrary to earlier reports which said that the iPhone would only be available with 2-year AT&T contracts.

It follows that if prepay users in the US are able to purchase iPhones, it's likely that we'll be offered the same options in Europe.

Sting in the sale

However there could be a sting in the sale. No contract means that the phone companies are unlikely to subsidise the iPhone. And when you consider that you were going to have to pay £300 on top of any subsidy anyway, a PAYG option could be very expensive indeed.

Of course we don't really know anything yet, so check back and as soon as more information comes in, we'll let you know.