No handset has generated more interest among consumers and the trade alike than the iPhone. And unlocking it from O2, Apple’s exclusive partner, has spawned its own niche industry, with companies like Phone Unlock dealing with nothing else besides the iPhone. The subject is shrouded with an air of mystery Ð given that both Apple and O2 refuse to comment on the issue.
Nonetheless, Mobile has gained an insight into the murky world of iPhone unlocking, and discovered that nobody knows exactly how rife the practice is.
One very important distinction between iPhone and other forms of handset unlocking is that the former offers repeat business, rather than being a one-off. This is because Apple regularly releases software upgrades on the iPhone which introduces new features, and the phone has to be ‘unlocked’ again.
Every time Apple produces a new version of the iPhone software, it improves its security so the unlockers have to go back to the drawing board. At the recent Macworld show in San Francisco, Steve Jobs announced version 1.1.3 for iPhone. All the unlockers immediately recommended that unlocked iPhone owners shouldn’t install it otherwise their handsets will be locked again. As Jody Sanders, MD at Phone Unlock, describes it, iPhone unlocking is more like a subscription service rather than a single sale.
O2 argues that the ability to upgrade software for free is one of the reasons why iPhone users shouldn’t unlock their handsets. A spokesperson for the operator told Mobile: ‘The vast majority of people who have purchased iPhones have chosen the full iPhone experience on O2. This gives truly unlimited data, free access to The Cloud’s 7,500 Wi-Fi hotspots, Visual Voicemail, dedicated iPhone specialists in customer services, and the potential to upgrade their device whenever new software becomes available.’
When approached by Mobile, Apple claimed that no spokesperson was available to talk about the unlocking issue. One consequence of this silence is that it is almost impossible to gauge exactly how many iPhones have been unlocked in the UK. The subject is especially fraught given that Apple reputedly warned O2 not to reveal exactly how many of the four million units it claims to have sold worldwide in 200 days could actually be attributed to the UK market.
Curiously, one of the lowest sales estimates came from Phone Unlock’s Sanders who put the figure as low as 1-5% of all O2 iPhones sold. At the other end of the scale, Orange France’s spokesperson, Louis-Michel Aymard, recently claimed that the percentage of iPhones sold by the operators was ‘a lot smaller than 20%’.
A different situation exists in both the French and German markets where the respective operators are legally bound to sell unlocked iPhones to consumers. However, there’s a huge dispute as to whether such handsets remain country locked. Sanders is adamant that the handset offered by Orange France is country locked. ‘Orange may be saying it is a full unlock but it is not,’ he insisted.
That said, neither Sanders nor any of the other unlockers Mobile spoke to have seen any French iPhones being brought onto their premises for unlocking. This is likely because a purchaser would have to pay Orange France a total of £565 to obtain one. So it is simply uneconomical for us Brits.
There’s also disagreement over exactly who’s performing the majority of unlocks. Sanders rates it as a moderately easy task to perform; his company website quotes that the service takes just 10 minutes. He believes that most of the iPhone unlockers are technically minded and therefore most unlocks are DIY jobs. Nonetheless, around 15 iPhones per day are taken into his company’s store on Oxford Street for unlocking.
Another unlocker, Shahin Faraji, Unik GSM’s manager, agrees that in comparison to other handsets, it is very simple to unlock an iPhone. That’s in contrast with the very latest Nokias, for example, where only the networks can unlock them. With some Samsung models, the phone can be permanently damaged by inserting a wrong code gleaned from the internet. Given the potential danger and the high cost of the iPhone, Faraji maintains that most UK consumers prefer to take the handset to an unlocker rather than attempt the task themselves.
All the unlockers Mobile contacted have trade customers. The solution which Unik is currently supplying to the trade involves an adapter into which the user places an existing Sim card. The adapter then fools the iPhone into thinking it has an O2 Sim card inside. Faraji estimates that the wholesale price for this adapter is in the region of £25-£30, which translates into a retail price of £40 and above.
Faraji maintains that there are no codes on the internet to unlock an O2 iPhone because of its software version number (see box on page 15). However, he certainly believes there are independent retailers offering iPhones that are already unlocked to the general public. ‘They’re doing [that] all the time,’ Faraji assured Mobile. There is also a fair number of handsets turning up on eBay as a result of dealer unlocking.
Trade customers are also important to Faisal Sheik who prefers to describe himself as chief surgeon with unlocker Fone Doctors. Sheik reckons he has got some trade customers sitting on between 100 and 500 units, just waiting for software unlock on version 1.1.2 of Apple’s. Most unlockers believe a software unlock will eventually materialise and thus prove far more cost effective than the hardware unlocking alternative.
The demand for unlocking is constant, Sheik maintains, ‘I have seven iPhones right in front of me which came in today. The iPhone is a really impressive piece of kit, but people aren’t prepared to go onto a stupid contract [£35 per month for 200 minutes] just to get one.‘
With Apple failing to announce a 3G version of the iPhone, demand for unlocked handset looks set to increase.
The techno-speak and pricing
The ‘jailbreak’: This is the term used to describe an iPhone which has been modified so that it can use any O2 (or indeed Tesco) Sim card other than the original supplied with the handset by O2. This task can be performed via software, but it needs somebody familiar with an Apple Mac. Retail prices for this kind of unlock are around £25.
Software unlock: Early iPhones brought to the UK from the US can be unlocked using software. This applies to models using v 1.0.2 software and v 1.1.1. The owner then must not upgrade to the latest version of Apple’s iTunes software. Retail price is around £30.
Hardware unlock: This is the most popular form of unlocking. It involves inserting any Sim card into an adapter which fools the phone into believing it actually has an O2 Sim card. Retail price is about £50. Currently works for v 1.1.2 only (not v 1.1.3).
Un-bricking: This fix applies to an unlocked handset where the owner has accidentally upgraded to the latest version of Apple’s software and finds it is suddenly unusable again. Retail price is between £90 and £100.
Wil Harris, a director with internet business Chanelflip.com was so keen to get his hands on an iPhone that he purchased the Apple handset on a trip to New York, prior to its UK release. Harris then obtained one of the first unlocking codes from an outfit called the ‘iPhone Dev Team’.
These so-called software hacks exploited weaknesses in Apple’s original iPhone software. Consequently, Harris was able to use