Code to unlock iPhone cracked

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A group of anonymous software developers said they will soon start selling a program that will allow iPhone owners to use the hugely popular device on cell phone systems around the world and not just with AT&T.

Apple's iPhone is yet to go on sale outside the U.S.

Apple's iPhone, released in the United States two months ago, was engineered to operate for the first two years only on the AT&T system through an exclusive arrangement between Apple and AT&T. It has not yet been sold outside of the U.S.

Los Angeles software consultant Brett Schulte, who is not affiliated with the developers, demonstrated the software for CNN Friday evening.

An iPhone that had the new software appeared to work on the T-Mobile system just seconds after Schulte replaced the AT&T SIM card with a T-Mobile SIM card.

It's completely software hacked, Schulte said. There's no case opening required. It's not required to do any kind of disassembly. It took Schulte about two minutes to unlock the iPhone.

The developers would not give CNN their last names, saying We don't want to be hounded.

The said they would start selling the software, which they haven't yet priced, as soon as their online payment and customer service systems are ready. They're also waiting for more information from their lawyers.

Apple spokeswoman Jennifer Bowcock told CNN her company has no comment.

AT&T spokesman Mark Siegel said he couldn't speculate on the legality of unlocking the phone, but he added, When you sign up, you're signing a two-year contract. You're obligated to pay the bill.

When people buy the iPhone it's clear from our materials it's designed to operate exclusively on AT&T, Siegel said.

Schulte, however, said it is possible to buy an iPhone without being contractually obligated to AT&T.

The developers recently created a Web site -- iPhoneSIMfree.com -- but there is very little information on it and no direct way for anyone to purchase the software. Internet records showed they bought the domain name less than two weeks ago.

Two members of the group, who identified themselves only as "John" and "Liu," told CNN in a phone interview that a core group of six people on three continents worked to unlock the iPhone as a hobby.

They said they are fans of Apple products who thought the iPhone should be made accessible to people who cannot use AT&T.

I'm not in America and I can't use it, said Liu, who would not reveal the country in which he lives. It's not fair.

Asked if he thought modifying the iPhone was legal, he said That's a very good question. I truly believe it is.

John and Liu said they have not been contacted by either Apple or AT&T, but said that could change the moment their software goes on sale.

Earlier this month, a teenager figured out a way to unlock the iPhone, but his method required disassembly of the unit.