Unlocking the iPhone allows it to be used on networks other than that of AT&T (NYSE:T) that also use the GSM network system.
The most obvious other place to use the phone would be with Deutsche Telekcom’s (DT) T-Mobile here in the U.S., but it should be possible to use the phone on other GSM networks world-wide. The hack of the iPhone is different from previous breakthroughs, which relied on a variety of hardware devices to unlock the phone: this one requires only a software program.
Readers of Engadget have been arguing the last 24+ hours over whether the hack will bring more or less revenue to Apple. On the one hand, the ability for those who don’t wish to have an AT&T contract to use the phone with another network could boost Apple’s sales of the phone. On the other hand, Apple has a revenue-sharing arrangement with AT&T for each new customer signed to that carrier, and some have asked whether that revenue might be in jeopardy.
Note that Engadget is not offering the software for the hack. Rather, the group that claims to have unlocked the iPhone, iphonesimfree.com, is offering on its Web site to start selling the software next week and was already inviting purchase inquries at its Web site.
Engadget noted that a second group, UniquePhones, said late Friday that they would start selling unlocking software for the iPhone by noon, Saturday. However, a post on the UniquePhones Web site Saturday said the the outfit had received a phone call early Saturday morning from a lawyer claiming to represent AT&T and alerting the group that said software represents copyright infringement and other violations. UniquePhones says the firm will not offer the software for sale until further consultation with the group’s lawyers. A report on UniquePhones back in July by Engadget stated that the group was planning to offer the unlocking software, once completed, for $49.95 per copy.
It should be interesting to see when and if Apple will circumvent the hack with a modification to the iPhone’s software. Several readers of Engadget speculated as to whether Apple would be willing to “brick” the iPhones currently in circulation, meaning, to render them unusable, to prevent unlocked use.Addendum: The unlocking stories are coming fast and furious. China’s Xinhua news service ran an article Sunday about three Israeli engineers who say they’ve unlocked their phones and were able to give the phones a Hebrew-language interface. Not too many details about what exactly is meant by that, or the manner in which any of this was done.