Playing with iPhone

17-year-old George Hotz's much-publicized hacking of the iPhone involved ripping open his $600 device and diving in with a soldering iron--not a technique for the faint of heart. But new tools are emerging that promise to make unlocking the iPhone for use on mobile networks other than AT&T's as easy as downloading and running a simple piece of software.

The iPhone Dev Team, an international group of hackers collaborating online, said Tuesday it had cracked programs deeply embedded in the iPhone that restricted the device to communicating only on AT&T's (nyse: T - news - people ) wireless network. The team has posted free software and step-by-step instructions for manually unlocking the iPhone on its Web site. (The group has asked journalists not to link to the Web site.) Those who use it will be able to make voice calls on other networks without altering the iPhone's hardware.

The Dev Team, whose research was instrumental in Hotz's initial hacking of the iPhone's hardware, isn't the first to offer a software-only unlock. One company, iPhoneSIMfree, said last month it had developed a software-only modification it planned to sell only to iPhone vendors. The company, which seems to have no physical location off the Web, changed its plans and released the software to users Monday at a cost of $99 per unlocking.

The Dev Team, by contrast, is offering its findings pro bono, and developers are already using the information to build free, user-friendly unlocking programs. David Harrison, a 23-year-old hacker in Belfast, Northern Ireland, claims to be the first to package the procedure in an all-inclusive piece of software that can be downloaded for free.

Harrison says he unlocked his phone in about 20 minutes. He put his program online early Wednesday but plans to release a speedier version in the next day or two that, he said, will do the job in less than five minutes. "Even a 10-year-old will be able to figure this out," he said. Harrison said he was speaking to Forbes.com on an iPhone, using the Vodafone network.

Harrison and other iPhone hackers in the iPhone Dev Team community don't intend to profit from their programs, though the iPhone Dev Team does solicit donations on its Web site to fund its research. Harrison said he simply wants to enable iPhone users to make calls outside the U.S., where there is no access to AT&T's network.

Harrison's claim of creating the first one-click package for the unlocking software is controversial. The iPhone Dev Team has accused him of stealing their code to create the program, and many in the hacker community instead credit Erica Sadun, a blogger for the Unofficial Apple Weblog.

But regardless of who has created unlocking software first, a larger question may be whether it's legal. The Digital Millennium Copyright Act of 1999 prohibits users from circumventing technological locks that protect proprietary content. But in November 2006, Jennifer Granick, a cyber-law attorney at the Electronic Frontier Foundation, won an exemption that makes it legal for users to break such locks to enable use of their phones on competing wireless networks. And since the U.S. legislation is stricter than equivalent laws in other countries, it is unlikely to influence international distribution of such programs.

Regardless, Piper Jaffray financial analyst Gene Munster says he doubts the hacking will hamper the bump in business AT&T has gotten from the iPhone. He estimates that AT&T's revenue from the contract with Apple (nasdaq: AAPL - news - people ) at between $40 million and $60 million a month, and that iPhone sales have tripled since Apple's price slashing last week. Munster believes no more than 5% of iPhone users will hack their phones to use other networks.

Granick points out that users who hack their phones will still be bound to their AT&T contracts and will have to pay a fee to switch to a different carrier. "This is no tragedy for AT&T," she said. "They'll get what they're entitled to. They'll just have to enforce their contracts legally instead of technologically."

IPhone users may have to sacrifice a few features if they try to use another network. Only AT&T can offer the iPhone's visual voice-mail feature, which allows users to see who has left them messages and listen to them in any order. No hack will allow this service outside an AT&T contract until other networks develop similar technology.

Hackers have, nonetheless, figured out how to circumvent AT&T's text message technology. Instead of sending costly SMS messages via AT&T, some hackers have installed AOL Instant Messenger on their iPhones. MSN Messenger may be next, said Harrison.

"Before this is over, you'll be able to do everything on your iPhone you can do with a laptop," he predicted.