If you've had your iPhone more than 12 months then 02 will unlock it for you if you fill in the form on their website, then you'll be able to use local sims while abroad and shift to month-to-month sim-only deals on any network once your fixed term contract runs out.

You keep mentioning "free" upgrades. Do you just mean that you don't need to pay for the phone up front and instead (re)-sign an 18 or 24 month contract with minimum monthly payments? It's not really free, it's just like paying off your phone in installments. I saved money by paying more than the minimum necessary for my iPhone and paying a lower price each month than the minimum I'd pay to get the phone for "free". Even if it worked out cheaper in theory, you're locked into that price for 18 months. Now I'm out my contract my monthly cost is halved but the number of free minutes I got for that money quadrupled. I could get an even better deal if I switched carriers, but I can't be bothered.

As always you should do some calculations. I would just say that in general (if you are in Germany) the costs are about the same.