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I think you have to jailbreak it for a UK SIM card to work. buy a pre-paid phone in London, they're a lot cheaper than calling with a US one. You can buy European calling packages from Verizon for your phone.
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Jailbreak allows you to add apps that are not approved and do other stuff to the phone. The phone needs to be unlocked by the carrier to use other SIM cards (yes, sometimes there are ways the end user can unlock as well),