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Expect a software update from Apple soon, iPhone users — and a slew of lawsuits to follow. Today it was announced that a hard working team of developers have figured out a way to unlock the iPhone using only software. (Previously a few brave folks learned they could unlock the iPhone with some serious hardware hacking – soldering, scraping, and then more software hacking.)

To date Apple has not tried to stop people hacking its device – either the iPhone or the Apple TV. Apple TV updates have practically embraced the hacks people have come up with and the two iPhone updates that have been released so far still allow hacks, but only work on unhacked devices. (Forcing users to undo all the hacks before updating or suffer through a complete factory restore – i cried a little.)

However past hacks to Apple devices have never broken any of Apple’s revenue streams, or any other company’s revenue stream for that matter. If this one hack continues to work, it will definitely cut AT&T’s revenue, but it will also cut down Apple’s if rumors about them getting a 10% cut of all iPhone data plans is true.

But the issue isn’t that simple. Last year the Librarian of Congress (who, believe it or not has domain over this) said that unlocking GSM phones to work on other carriers is not illegal. So although it’s likely Apple and / or AT&T will try to sue the developers once their identity is discovered, it’s also likely this suit will get thrown out of court.

One interesting thing that was revealed through this process is that the iPhone 1.0.1 update added a hidden settings panel that lets users customize data settings. so unlocked iPhones can be configured to fully work on any network (except for visual voicemail). Could it be Apple is tacitly supporting these efforts, or is this something that was added because of Apple’s rumored multi-carrier agreement in Europe?

A special shout out to Carlo Longino and Craig Froehle for planting the seeds of this post in my brain.

I go to a lot of concerts. Generally one or more per month. While some stadiums in and around the metro NYC area (read: the ones in NJ) have beefed up wireless coverage, many venues continue to totally suck with respect to providing solid access.

Last night, for example, I saw Chris Cornell at the Beacon Theater in NYC. (Great show, by the way. Awesome collection of Soundgarden, Audioslave, Temple of the Dog and Chris’s solo stuff.) Standing just outside the doors to the theater, which is an old-school, opera-house type place, I had great coverage on the two phones I had with me. One was Verizon, the other AT&T. I was able to make and receive with both phones no problem-o.

Once I walked inside, though, coverage on my Verizon phone began to waffle between one bar and no bars. The AT&T phone dropped down to 3 bars. During the course of the evening, I attempted to make several calls with my Verizon handset. Fully 50% of the calls failed to go through at all. Those that did, lasted a mere 10 seconds before being disconnected or dropped. Even though the AT&T phone had more signal strength, it fared no better. I tried making several calls with it. Only one connected at all, and was dropped as soon as I got the word “Hello” out of my mouth.

Data services, such as SMS, fared a bit better. There was a slight delay in sending a receiving messages, but they all did eventually get through.

I understand the limitations of cell towers with respect to how many calls can be handled at any given moment. Ditto for the fact that places in NYC are often old buildings with some dense-ass materials blocking signals. But places that regularly host large groups of people (theaters, stadiums, etc.) should work with the cellular operators to make sure that their customers are adequately served while attending events in those venues.  Is it really that expensive/difficult to add capacity? C’mon guys.

I have had a few issues with my iPhone since buying it on June 29th and though I’d share ’em, with y’all.

For the most part, it has been a revelation on how good user interfaces can be. I am not going to into the pluses or minuses of the device, though. If that’s what you’re interested in, I’d refer you to Phone Scoop’s in-depth review.

So in the middle of last week, I was suddenly unable to access the Internet via my iPhone. I got an error message that read: Could Not Activate EDGE. I was a little miffed, but have had random connection issues with other phones. So I decided to give it some time. An hour later, still no luck. My iPhone was also have difficulty in sending SMS messages. It often took 3 or 4 attempts to get an SMS to successfully send to another phone. I chalked this up to a network anomoly and let it rest for a while.

Several hours later, though, I still had no luck connecting to the Internet. Eventually I gave up and went to bed. The next morning, I woke up and checked the iPhone. Still no Internet, but this time around I got a DNS Server error. Eep. I called AT&T customer service right away. (BTW, I had powered the phone on and off several times.)

I waited about 8 minutes to be connected a rep. Once connected, the rep checked my account and told me that my data account was still active, and there had been no network issues in the area. Since it wasn’t service related, he decided to transfer me to an Apple rep.

I waited on hold again for another 8 to 10 minutes. Once I spoke to the Apple rep (who was chipper as hell, BTW), she had me reset the iPhone. It took several attempts. After the second attempt, the iPhone was able to reconnect to the EDGE network and successfully browse the Web. Cool.

Two days later, though, I had another failure with the iPhone, this time hardware related. After using it as an iPod for a while and listening to some Machine Head, I pulled out the headphones. From then on, the ear piece speaker failed to work. The speakerphone worked just fine, but the ear piece speaker made no sound at all, and calls could not be heard using the iPhone as a regular phone.

Since I had a similar issue with a Treo several years ago, I took it directly to the Apple store. Unfortunately I had to wait two days to get an appointment with an Apple Genius.  After I explained the problem to him, he agreed that it was a hardware issue and it needed to be fixed. The little mechanism inside the headphone jack that shuts off the ear piece speaker and routes calls to the headphones was permanently activated. Since the 14-day return window had expired, they wouldn’t just give me a new phone. It was sent off to be repaired. Apple offered a temporary iPhone replacement for me to use, but I declined, preferring to just use another handset I had at home.  So I took my SIM and put it in a BlackBerry Pearl. The experience was jarring. I had loved my Pearl. After just 3 weeks with the iPhone, though, the BB OS was jarring to use.

I switched to a Nokia E61i, and that was much better. Thankfully I only had to use it for three days. Apple FedExed the iPhone back to me just 70 hours after I dropped it off at the Apple store. The repair was free, but the experience did stink, and made me lose a little bit of confidence in the quality of the new phone.

Google upgraded its Mobile Maps application with expanded GPS functionality. GMM is now able to take advantage of GPS systems to provide real-time location based services including directions and traffic info. Until now, Google Maps had not supported either external or internal GPS on all phones. After checking it out, the step-by-step directions certainly work. Eric and I agree that having to manually select the next “step” is just a wee bit dangerous, though. True turn-by-turn directions would be better.

The real-time traffic alerts were spot on, too. I plotted a course from my house to Giants Stadium. Hitting the “show traffic” key displayed some congestion on Route 46. The local radio station confirmed this. Traffic is shown with red coloring on your intended route. It would have been cooler if a pop-up bubble told us exactly what the congestions was, or at least mentioned which side of the highway was being affected.

Of course, the service is free, so we really shouldn’t complain. Too much. I am just glad the directions aren’t populated with little advertisements: “Stop here for some McDonald’s.”