O2 has stepped up its data plan for iPhone owners - offering truly unlimited data downloads, the company has revealed.

Apple's exclusive UK mobile network provider for the iPhone had previously confirmed data traffic would be confined to a paltry 200Mb per month, well below that supplied by competing vendors in the UK smartphone industry.

The company had originally announced that iPhone users signing-up for one of its three tariffs for the device would enjoy unlimited data downloads, though it later emerged that unlimited meant a pathetic 200 megabits of data per month under O2's fair usage agreement.

See: Apple iPhone UK review

Potential iPhone users were annoyed at this, complaining the cap would reduce the functionality of the truly internet-savvy device.

A Telegraph report cites O2 chief executive, Matthew Key, who said of the decision to remove the usage cap: "Customers find 'unlimited with limits' confusing, plus most people don't speak in megabits or understand what they equate to."

He added: "We've taken the decision to remove the fair usage cap so that 'unlimited' really does mean 'unlimited' - this is a market first."

Apple's iPhone goes on sale in the UK this Friday and costs £269.