Can you use Iphone as ipod only?

Can anyone help with this. I hate my iphone. Have had nothing but trouble since I bought it. It's broken again and now I am being told it will take at least 7 days to repair during which time I will have no phone as i'm not entitled to a replacement even though it's under warranty. Anyway, was thinking of just going and buying a new phone. Back to basics for me...calls, texts and picture messages (which the iphone can't even do). As I paid a good bit of money for the iphone I don't want it to be completely redundant so I was wondering can I still use it just as an ipod and have the phone and internet disabled? Any advice would be great.

I would get the phone repaired/replaced and see if you can get a loan of another handset while this is done. Of course you don't have to use the phone functionality of the iphone but its a bit of a waste. Turning on airplane mode will disable phone and wifi.

However there is a software release due out in June I think (V 3.0) which is going to add some of the funtionality you want and thathas been sorely missing from the iPhone
http://www.apple.com/iphone/preview-iphone-os/

I suspect the OP's question is effectively whether the iPod will work without a SIM card?

What tariff did you sign up for, and how long?

Yeah that is essentially my question. I signed up to an 18-month contract but O2 told me during the week that the contract is concerned with me staying with O2 more than me staying with Apple. I don't want to wait until the 18-month contract expires in September before changing phone so I hope this is the case as I have no problem staying with O2...just don't want to use an iphone. But I do want to still use it as an ipod with no sim...is this possible?

Why don't you take out the sim and see for yourself?

I will when I get it back but it's currently being repaired and will be for at least the next week. Hence the post.

In the meantime, you might find this thread from Macrumours.com useful.

Just pick up a free pay as you go o2 sim and put that in your iphone

That won't work either as the Iphone is locked so that it works only with Post Pay Sims.
Either way your iphone should work no problem without the sim

That's great news. Thanks.