There's a ongoing conflict about whether the iphone can be unlocked or not. I was interested myself whether it could or not even though I use AT&T as my provider. So on my quest to find out the truth i put to test myself and found it is true. It can be done. The unlock process is really easy and only took a few minutes. I had no problems with it. Once you put your new SIM in the phone, you have to go through the usual activation process.
We tested with an active T-Mobile SIM -- after the hack was finished and we reactivated we immediately got full bars and the T-Mobile carrier info popped up in the top bar. Everything is otherwise the same, except the menu system now has a couple more options. The root menu has Carrier settings where you can select your preferred network if you don't want to roam.
The General -> Network menu now has an EDGE network settings area where you can input your carrier's APN and username / password. We put in our T-Mobile info, and were immediately online. Visual voicemail isn't in the cards -- sorry. That was, of course, to be expected because it's a special AT&T network-specific feature right now. When you hit the voicemail button you are taken immediately to your carrier's default voicemail line though, and that works just like it would on any other phone.
Everything is confirmed as working on a non-AT&T network: SMS send / receive, internet (including Safari, Mail, Google maps, etc.). YouTube doesn't work out of the box, but that's to be expected. (YouTube is the only app you have to activate.)
The 1 Click iPhone Unlock guys claim this method is restore (though not necessarily upgrade) resistant. We have no way of knowing whether Apple will be able to disable this SIM unlock with future iPhone software updates, but we can confirm that it is restore-resistant. We performed a full restore (v1.0.2) on our iPhone and successfully activated it using an inactive AT&T SIM. After fake-activating our iPhone, you merely pop out the AT&T SIM, put in the foreign SIM of your choosing, reactivate, and you're done. Restoring from an iPhone backup in iTunes worked perfectly despite the lock and foreign SIM. The only thing to notice was the phone number is now listed as "n/a" in iTunes. The 1 Click iPhone Unlock Software is really cheap and afforable compared to other unlock software. Check out the video below for the proof.
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