O2, the iPhone service provider in the UK, claims it will disconnect anyone using the new tethering feature in the iPhone 3.0 update without signing up for its bolt-on data package.
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. O2’s iPhone tethering bolt-on will cost up to £29.36 a month. However reports indicate that iPhone users have been able to get around this requirement.
O2 has threatened to disconnect anyone using tethering, as it will be in breach of their contract. “Any use of this particular feature without the purchase of the bolt-on is specifically prohibited under our terms of service,†O2 said. “Under those terms, we reserve the right to charge customers making modem use of their iPhone or disconnect them.â€

Really Annoyed with o2’s pricing for tethering. Making it more expensive than many separate dongles (that come with a free laptop!!!) is incredible especially when I already own the hardware!
I hope noone signs up and they have to address this pricing!
…but how are they going to know?
Greed pure and simple from O2 and other carriers.
How will they know …. useage stats I imagine, I reckon that if you ‘just’ use it as a back up option from time to time it will be hard for them. What they are after are peiple that are going to use it as their prime means of accessing the interent.
well i never seen nothing in contract about using tether so by cutting someone of line would be wrong
people would do this if they didnt charge so much for tethering
nothing in my contract in 2008 about using teether without lience
if i was going to pay £10 a extra or more a month i go and buy a dongle and get free laptop
come on o2 dont be greedy you have alot of customers and its not good to loose us
internet tethering for iphone should be £5 thats by far fair