Apple says unlocking software can damage iPhone

SAN FRANCISCO Mon Sep 24, 2007 6:59pm EDT

Journalists test an Apple iPhone following its introduction in Berlin September 19, 2007. REUTERS/Fabrizio Bensch

Journalists test an Apple iPhone following its introduction in Berlin September 19, 2007.

Credit: Reuters/Fabrizio Bensch

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SAN FRANCISCO (Reuters) - Apple Inc said on Monday that programs available on the Internet that allow the iPhone to be used with other service providers besides AT&T's Cingular network can irreparably damage the device.

Apple, which also makes the Mac computer, the iPod digital music player and runs the iTunes online store, said once an Apple-supplied software update is installed on the iPhone, it "will likely result in the modified iPhone becoming permanently inoperable."

Since the iPhone's introduction at the end of June, Apple has said it expects to sell 1 million units by the end of this month. In the first two days it was on sale, Apple said it sold 270,000 of the gadgets.

"We are not doing anything proactively to disable iPhones that have been hacked or unlocked," Phil Schiller, Apple's head of worldwide product marking told Reuters.

Asked how widespread the practice of downloading unlocking software, he replied, "We do not know."

The Cupertino, California-based company also said an iPhone that fails to work because of the installation of the unlocking software is not covered under the warranty.

Apple plans to release the next iPhone software update later this week, the company said in a statement. In the United States, AT&T Inc (T.N) is the only authorized service provider for the iPhone.

"Apple strongly discourages users from installing unauthorized unlocking programs on their iPhones," the company said.

There are a number of unlocking software programs on the Internet, and, at least two of them, iUnlock and Anysim, can cause the iPhone to stop working once its software is updated, Schiller said.

"There may be others, but we don't know all of them," he said.

Apple sharply cut the price of the iPhone earlier this month and revamped its full iPod line, adding a model that can browse the Web and buy songs wirelessly.

He declined to comment on the company's financial performance so far in the quarter or its expectations for sales in the holiday sales period at the end of the year.

In the past few weeks, Apple and telecommunications service providers in Europe have been announcing deals to provide service for the iPhone, which handles phone calls, surfs the Internet, and sends instant messages and e-mail.

Shares of Apple rose $4.13, or 2.9 percent, to close at $148.28 on Monday on Nasdaq. The rise came after Citigroup (C.N) raised its share-price target for the company.

In extended trade, the stock eased by 8 cents. So far this year, the stock is up about 73 percent.

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