As I offer various computer services here and elsewhere, I have had several people ask me about getting their iPhone to work with other SIMs. So, this is brief discussion of the issue to help you understand the terminology and find out if it's possible for you.
When the original iPhone (2G) came out, hackers had to accomplish three things: activating, jailbreaking and unlocking.
activating: that one-time process of getting the phone 'registered' with AT&T (the US cell phone provider for the iPhone).
jailbreaking: the process of making the iPhone able to load other applications (this was before the App Store existed).
Unlocking: enable the iPhone to be used with other SIM cards.
Activating and jailbreaking went rather quickly, but unlocking took several iterations before it was successful and also didn't require a soldering iron or similar. Now, it's pretty easy....except....
There are two key software components in the iPhone: Version and Modem Firmware, both of which you can see by going to Settings > General > About.
Apple upgrades either or both of these when they want to add new functionality to the phone. When they do, it often breaks previously successful hacks, so the hacking gods have to update their software.
When the phone was first released, it took months before the activation / jailbreak / unlock was successful. When the Version and Firmware were updated, sometimes it took weeks, days or just hours for the hacks to be updated. For most of the last 12-18 months, the process of hacking an iPhone to be used with other SIM cards was pretty easy and was updated within days of any Apple updates.
But, recently, Apple introduced Version 3.1.3 and Modem Firmware 05.12.01. To date, this combination has NOT been unlocked. Activation is now a thing of the past. Jailbreaks work, but you CANNOT use such an iPhone with another SIM card......yet.
There are *many* sites on the 'net which are happy to take your money to 'unlock' your iPhone, but it's all lies, lies, lies. Don't waste your money.
If your Version and Firmware are any earlier version, then you can use Pwnage 3.1.5 (google it) to painlessly hack your iPhone. Just make sure you *DON'T* update the Version from within iTunes or you'll be back at square one.
If you have 3.1.3 and 05.12.01, then be patient. The iPhone Gods have assured us that they will make an unlock available, when the new 4.0 comes out..... but we just don't know when it's coming out, not definitively, at least.
If you have any questions, thoughts, contributions... let me know.



