iPhone unlocked by hacker: AT&T loses iPhone exclusivity

Some 17 year old kid from New Jersey figured out how to hack an iPhone so it can be used with any carrier, not just AT&T and now the prototype is on eBay, currently going for about $3,000.

While the possibility of switching from AT&T to T-Mobile or whatever may not be a major development for U.S. consumers, it opens up the iPhone for use on the networks of overseas carriers.

The hack is complicated and requires skill with both soldering and software. It takes about 2 hours to perform. Since the details are public, it seems likely that a small industry may spring up to buy U.S. iPhones, unlock them and send them overseas

He posted the steps on his blog.