IPhone Cracked: IPhone Can Now Work Without AT&T Network, Cracked IPhone Sells on EBay for $26 Million and Counting?

Much to AT&T's chagrin, iPhone owners can use the iPhone with out the dreadful AT&T contract. Will this news help iPhone sales?

Apparently, the new of the cracked iPhone will not help those who would like to purchase the second cracked iPhone in history. Currently, the second cracked iPhone is selling on eBay for $26 million and counting.

According to his website, http://iphonejtag.blogspot.com/, George Hotz cracked the SIM, made a video to prove it and posted the cracked phone on eBay starting the bidding at $540.

Why is this such a big deal?

By removing the iPhone's SIM, Subscriber Identity Module, one removes the smart card containing the telephone number of the subscriber, the PIN and many other user data encoded network identification details. A user's SIM card can be moved from phone to phone as it contains all the key information required to activate the phone. However, rumor has it that the cracked iPhone can still only be used on either the T-mobile or AT&T network. Yay for T-mobile? Eh. iPhoneSIMfree.com says that cracking the SIM makes the iPhone fully functional for users outside of the US.

Anyway, the jury is still out on whether or not cracking the iPhone's SIM is against the law.

Sources

Engadget, http://www.engadget.com/2007/08/24/iphone-unlocked-atandt-loses-iphone-exclusivity-august-24-2007

http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&item=230164884672

http://iphonejtag.blogspot.com/