iPhone owners who have installed the iPhone 3.0 update are reporting that it is possible to use the new tethering solution to hook up a laptop to use an iPhone's internet connection for free.

O2 intends to roll out a tethering Bolt On with the launch of the iPhone 3G S today. O2s will cost up to £29.36 a month. However reports indicate that iPhone users have been able to get around this requirement.

as it will be in breach of their contract.

O2 said: "Any use of this particular feature without the purchase of the Bolt On is specifically prohibited under our terms of serviceUnder those terms we reserve the right to charge customers making modem use of their iPhone or disconnect them."