OK I have rang and emailed the O2 customer services, quite funny the email i recieved ...
Thanks for emailing us to find out if your can use your iPhone SIM card in another phone.
iPhone SIM card can't be used in another phone. This is because iPhone has its own in built SIM card.
You won't be charged for the video calls from your iPhone as it's deducted from your voice call allowance. When you'll exceed your voice call allowance, you'll be charged 20p including VAT (Value Added Tax) per minutes for video call.
Please note that the video calls and unlimited data Bolt On won't apply on your new handset, as you're unable to use the iPhone SIM card in another phone.
I hope you'll find this information useful. If there's anything else we can do for you, please reply to this email.
You can also visit our website using the link
http://www.o2.co.uk/iphone for the most up to date information on iPhone.
Important - When you email us please provide: your date of birth, postcode and mobile number as it helps us answer your query faster.
Kind regards,
Kashisha Rangra
O2 Customer Service.
Anyways rang up, much more reliable info. Found out that yes I can take the sim card out and put it in another phone, when this is in another phone you can make video calls, and on O2-UK you can make them for free because their included with inclusive minutes (Voice and Video calls are charged the same amount). Also I need to test the free internet, but it should be fine though. Also I have made video calls and they are coming out of my inclusive minutes. Wow I have 20 hours of free video calls