• The Associated Press, Wednesday, June 11, 2008 11 AM

Apple's new 3G model will stem the flow of unlocked iPhones, The Associated Press says, citing the handset's eventual availability in more than 70 countries (the first iPhone was only available in five), as well as the new arrangement under which it will be sold. Indeed, gone are the days when consumers could go to their local Apple Store, buy an iPhone and have it unlocked in a matter of minutes. Now, because AT&T is subsidizing the cost of the phone, consumers will be forced to buy the reduced-price device with a two-year contract and have it activated inside the store.

Under the prior arrangement, iPhone customers didn't have to activate their phones inside either AT&T or Apple's stores, enabling them to unlock at their leisure. As one iPhone user in Mexico-where Apple doesn't have a carrier agreement-said, "It's so easy. A minute-and-a-half, and all you have to do is push a button."

Well, not anymore. As John McLaughlin, founder of Uniquephones.com, a New York-based company that sells unlock codes for cell phones, said, "It's looking pretty bleak for (iPhone) unlockers." McLaughlin company ceased unlocking iPhones after a warning from AT&T's lawyers. As yet, Apple has no plans to sell unsubsidized phones. "We're just crossing our fingers and hoping for the best," said Kyle Jourdan, CEO of Freeit4less.com, another unlocking firm.

Read the whole story at The Associated Press »