SIMM Card

As long as your phone is unlocked from your carrier (ask your carrier), you can just buy a SIM card at the airport when you arrive in Italy. You will see lots of offers. There is no "best" one, since a lot depends on how you are going to use your phone. You would be well-advised to use your phone on wifi whenever you can because that will keep your use of data down. If you use your phone heavily at home for data and do not intend to modify your usage while abroad, you are not likely to find a "cheap" option. Data is expensive.

1. Make sure your Iphone5 is unblocked. If you purchased from the carrier under a 2 yr contract and 2 years have not expired, your mobile carrier will not unblock it and you are stuck with them. Otherwise they will give you a PUK code number to unblock it when you insert a new SIM card.
2. Once your Iphone is unblocked, you can buy an Italian SIM card when you get there at any cell phone store. The major providers in Italy are TIM, VODAFONE, WIND, and 3 (TRE). They have stores or authorized dealers everywhere. This summer Vodafone had a promotion that included 1Gb/month plus 500 voice minutes/SMS. The plan was €15, which included €5 credit for additional features. To that amount you need to add €10 for the cost of the new SIM card.
3. Once you insert that SIM card, your phone will have an Italian phone number. If you receive a message on your American number, you won't be able to retrieve it unless you reinsert your American SIM card. If you want to check your messages left on your American number you need to switch SIM cards occasionally in your phone. However each time you listen to a message left on your American number while abroad, you will be paying roaming charges to listen it. You will also be paying for reading SMS messages received. There is no charge for receiving calls or SMS messages on your Italian phone. European phones don't pay for receiving inbound calls/texts, unless they are roaming abroad.

Thank you for the two posts that have been received so far. I noticed that one of you listed a company called WIND. I checked their website and if I read it correctly, they have a plan they call the All Inclusive King which is 800 min voice (I think), 400 SMS, and 2 gb (I think). All for 17 euros/month. Have any of you used WIND and if so can you confirm that all is well with them? Thanks everybody!

I've had Wind and my cousin's daughter uses it (to my cousin's chagrin, since he's a manager for TIM). Wind tends to have better prices, but their coverage was spotty in some mountain areas (maybe better now). Since she lives in Rome, she's covered well. If your destinations are not in the woodsy parts of the Apennines or the Alps, you'll be ok with Wind too. Don't forget that you need to add €10 to the plan for the cost of the SIM card.

How long are you going for? I just added international stuff to my iphone through ATT and it wasn't very expensive and I thought worth it instead of the hassle of the SIM card. You may still decide to get a local SIM, but if you haven't, do check out just using your phone as is. Might be cheaper than you think.

Kim

Does anyone have experience with Keepgo? They have a data plan with 100mb a day for $2.99 but it is data only.

http://www.keepgo.com/single_country_sim_card/

How about a TIM plan called Welcome which is a one month only plan for tourists? It's 20 euro for 2 gb and 200 minutes. I think I read that you have to pay another 10 Euro for the sim card.

http://www.international.tim.it/en/tim-welcome

I used WIND when i was in Milan, Bologna, Florence, Venice. It was easy to sign up, popped in the sim card (then it required some time before i could turn my phone back on) But the problem that no one tells you is when you insert a new sim card in the iPhone it will send out a request to the activation network to make sure the phone isn't stolen. If your provider requires you to change any settings to get online then you would need a WIFI connection to do a quick activation before you can enter your SIM APN settings. Then you're all set.

I would purchase the sim when i get to italy, much cheaper. But like others have said, you will not get any text messages from your american sim card while the card has been taken out.

I was using an unlocked iPhone 5 (AT&T), Connecting to WIND Data only.

If you don't mind having a German telephone number check out http://travel-sim-germany.com They have very good pricing and the sim works throughout the EU.

I think the advice on this thread is good.