Hackers claim to untie Apple's iPhone from AT&T

SAN FRANCISCO (Reuters) - Hackers have found a way to use Apple's AAPL.O iPhone on networks other than AT&T's T.N, opening up the coveted device to rival carriers and overseas customers, according to a Web report on Friday.

A passer-by is reflected in a replica display of Apple's iPhone at the Fifth Avenue Apple store, June 25, 2007. Hackers have found a way to use Apple Inc's <AAPL.O> iPhone on networks other than AT&T's, opening up the coveted device to rival carriers and overseas customers, according to a Web report on Friday. REUTERS/Keith Bedford

A group called said it had developed a piece of software that, when installed on an iPhone, allows the use of rival mobile services such as T-Mobile, according to widely followed technology blog

AT&T has an exclusive two-year agreement to provide phone and data services for the iPhone in the United States. Apple is in talks with carriers in several European countries to launch the device there by the end of the year.

Enabling the combination phone, media player and Web browser to run on other networks -- known as “unlocking” -- has been a stated goal of many hackers since the iPhone hit the market in late June.

“The unlock process took only a couple of minutes. From our end it was totally painless,” Engadget said.

Several other methods for unlocking the iPhone have emerged on the Internet in the past few weeks, although they involve tinkering with the iPhone hardware or more complicated ways of bypassing the protections for AT&T’s exclusivity.

AT&T spokesman Mark Siegel declined to comment on the Engadget report and an Apple spokesman could not be immediately reached. An e-mail sent to was not immediately answered.

The iPhone is based on GSM wireless technology, which is deployed widely throughout Europe but used in the United States only by AT&T and Deutsche Telekom's DTEGn.DE T-Mobile.

“Inside the United States it’s not going to be a huge deal, outside the United States it’s probably going to be a big deal until Apple gets agreements in place with partners there,” said Jeremy Horwitz, editor-in-chief of, which tracks news of Apple products.

The hacker victory could also be fleeting since it may be possible for Apple to render the unlock process useless with an update to the iPhone software, Horwitz said.

Apple shares rose 3.2 percent to $135.30, while those of AT&T added 0.6 percent to $40.34.