Legal worries delay release of iPhone unlocking software

Fear of litigation has led to an indefinite delay in the planned Saturday release of software to unlock Apple's iPhone.

John McLaughlin, founder of Uniquephones, based in Belfast, Northern Ireland, said Saturday that he received a phone call about 3 a.m. Saturday local time from a man claiming to be from O'Melveny & Myers LLP, an international law firm, calling on behalf of AT&T. The firm has worked with Apple in the past.

The man informed McLaughlin that if he posted the unlock code, he could be sued for copyright infringement and for dissemination of Apple's intellectual property (IP).

McLaughlin was not completely awake when he took the call and did not get the full name of the person on the other end, he said. The man presented "friendly advice," but because of the timing of the call and the fact that it came on a personal mobile phone that McLaughlin never uses for business, it felt more threatening than friendly.

"If he wants to give me advice, he could have sent me an e-mail," McLaughlin said.

Spokespeople with O'Melveny & Myers, AT&T Wireless, and Apple could not be immediately reached for comment Saturday.

McLaughlin and his team had planned to release software by 2 p.m. EDT that he claims would unlock the iPhone so that it could work with SIM (Subscriber Identity Module) cards from carriers other than AT&T Wireless.

Uniquephones set up the Web site right after the iPhone's release on June 29 and had been working on the software since then.

McLaughlin is concerned that fighting a lawsuit with AT&T or Apple would sink his small company, which does a modestly successful business unlocking wireless handsets in the U.K. and Europe. At the same time, he and engineers in several countries have invested time and money to come up with the unlock software.

"It really annoys me," he said. "We have the solution sitting there and we have the customers there, but if you connect the two you could lose everything."

About 550,000 people have signed up on Uniquephones' iPhone unlocking site as of Saturday afternoon in the U.K.

McLaughlin said he still plans to release the software eventually, but is not sure when. "We'd be happy to let another company take the heat and be the second or third company to post [the software]," he said.

In addition to Uniquephones' software, there have been two other reports of ways the iPhone can be unlocked. On Friday, blogger George Hotz posted a step-by-step tutorial for unlocking the iPhone that involves both hardware and software modifications. At another site, www.iPhoneSimFree.com, a company claims it can unlock iPhones through software only.

The iPhone has been a hot target for unlocking since its launch, both because of its advanced design and features and because AT&T has an unusual long-term exclusive relationship with Apple. It's common for U.S. mobile operators to lock the phones they sell, but in some cases they will later unlock the phones free or for a small fee.