Studying abroad in London for 4 months - international plan

I'm going to be studying abroad in the UK for 4 months starting in January. I want to be able to use my iPhone while I'm abroad, in the most cost-efficient way possible. I've looked at the AT&T World Traveler Plan that is $5.99 per month, and 99 cents per minute. 99 cents per minute seems ridiculous! Is that plan in addition to the basic U.S. iPhone plan that I have now or does it take the place of my current plan?
I've read stories here on the discussions about people getting a $1,000+ wireless bill for their overseas usage, and I want to avoid that.
What about the option to unlock the iPhone from AT&T and use a SIM card from a wireless carrier in the UK? I've been told that wireless companies are required by law to do this if the customer asks... but the AT&T customer service rep. I asked today said this is not possible because of the exclusive agreement between AT&T and Apple. What's the deal with this?
Any help would be appreciated. Thanks.

If you do get a UK SIM (on your unlocked iPhone or on a cheap UK mobile), it will not be cheap to use to ring the US, whether you use Vodaphone or Tesco - sign up to 18185.co.uk and use their numbers to make cheap US calls - currently .5p/min on landlines and 1p/min on mobiles. See
http://www.18185.co.uk/mobilerates.php
for details.

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    welcome to the BT community forum where you probably read is where customers help customers and only BT employees are the forum mods
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