From pay as you go to contract
Just a tip: I changed my pay as you go to a Contract and got a brand new Nokia N95 8GB for free. I think bought Movistar and Vodafone (possible more of them) have this deal.
I just gave them my NIE number, sim-card number (the long number printed on the sim-card), my address and they sorted everything out on the phone for me. I think these offers are open to everyone who has had pay as you go for more than 6 months.
For me coverage and stability is more important than the price (I call for about 100 euro a month), so I went with Movistar.
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