By one measure, Apple’s iPhone has received the highest of compliments: It’s drawn the attention of hackers and tinkerers working non-stop to unlock the features that tie the phone service to AT&T.
A New Jersey teenager took a hardware approach with tools that included a soldering iron in order to replace the iPhone’s SIM chip with one from T-Mobile. He then showed how he was able to make calls on a T-Mobile account, bypassing AT&T. George Hotz, 17, detailed his efforts, which he said took most of the summer to develop, on his blog. And in the end, the founder of CertiCell, a supplier of new and refurbished OEM and after-market handset parts, offered to trade Hotz a Nissan 350Z for the hacked iPhone. He accepted.
While the hardware hack is time-consuming and perhaps imprecise for the less-technically adept, other simpler, software-based unlocking schemes emerged on the Web, as well. Contacted by internetnews.com both AT&T
said they had no comment on any of the schemes. The FAQ section of both companies’ Web sites raise the question of whether it’s OK to use a different SIM card than the one pre-installed in the iPhone.
The AT&T answer is direct: “No. iPhone must be activated before it can be used. iPhone includes a pre-installed SIM card for your convenience.”
Apple’s answer is a bit less definitive: “You should use the SIM card that came pre-installed in the iPhone.”
The immediate impact of these schemes to bypass AT&T is hard to measure at this point. Analysts and security experts expressed greater concern about what might come next. The first significant public hack of the iPhone came earlier this month at the Black Hat security conference. But the security researcher behind that effort gave Apple a heads up about how it was down, and Apple subsequently issued a patch.
Now there’s concern others will build on these recent efforts to create a consumer-friendly product or system to easily bypass AT&T.
“This is a big deal for AT&T if the software hack is even remotely easy to use,” Gartner analyst Mike McGuire told internetnews.com. Ironically, McGuire notes Apple might even see a spurt in iPhone sales to European consumers who could use the software trick to make the iPhone work on their networks even though the device is not yet available for sale there.
“Apple can issue a software update to deal with some of this, but hacking is an issue AT&T is going to have to deal with,” said McGuire.
Mike Dager, the CEO of Arxan, said software updates are only a short-term solution. “Every solution provided by the vendor is an another challenge to the hackers,” he told internetnews.com. “Basic cell phone hacking has been going on for years, but the iPhone is a high-profile device.”
Arxan specializes in intellectual property protection for embedded devices by fortifying the code against attacks, and Dager claims its technology would make the latest unlocking schemes “virtually impossible” if implemented.
But Dager also thinks Apple faces a more serious threat than SIM-swapping and that is companies reverse-engineering the iPhone and offering a cheaper alternative. “Some Chinese company will come out with an iPhone-like device they claim is their intellectual property, and sell it for $50,” he said. “Millions of people in Asia buy it and poor Apple will be sitting there trying to compete with these knock-offs.”
Analyst McGuire strongly disagrees. While he thinks some features similar to what Apple offers may appear in other mobile phones, he notes that Apple controls its operating system and offers a unique mix of technology expertise.
“There are very few people that can come up with the software and user interface that’s as useful and compelling as the iPhone,” said McGuire. “A lot will try. I do hope that Nokia, Microsoft and others keep innovating on the UI because competition is good.”