Well there is an increasing trend to sign up for 18 months contracts but still generally people only want yearly ones. I would sign up for 18 months if it meant I could get the iPhone (maybe a little cheaper but that is not apples way)
I was in the mind never to go with an 18 month contract, but it certainly is the way all contracts seem to be going in the UK at the moment, unless you're willing to pay more for the same thing just to stay on 12 months.
I am however on an 18 month contract now, as I had to make 1 concession when dealing with O2 and getting my current contract deal and phone, it saves me in the long run and gives me more bargaining power against them in the long run I guess. If you speak to O2 right, they will usually do something for you for customer loyalty, and not just the "off the shelf" offers, so to speak.
I hope it does go to multiple carriers, but while Apple demands revenue etc I doubt that will happen. Who knows though, maybe Apple will change their demands slightly after they see how things pan out in the US...given that, as mpw said, the Europe and UK markets are very different, they need to do their homework here.