Apple gets sued once again, and this time they're getting chewed out over something that was meant to make customers happy. iPhone owner Dongmei Li has filed a lawsuit against Apple, Steve Jobs, as well as AT&T over the iPhone price cut, and the US$ 100 rebate given to early adopters of the iPhone.

As previously reported, Jobs announced the iPhone price drop to US$ 399 in the same media event where he introduced the new iPod products. Some iPhone customers were disgruntled with the sudden price drop, but were appeased by the US$ 100 coupons sent to those who bought the iPhone launch units.

According to Li, she is now a victim of price discrimination as a result of the above business decisions that Apple and Jobs made, because she cannot resell her iPhone for the same value as those who bought it after the price drop.

Li stated that there was no reason behind the price cut, which she said was grounds to underselling.

The lawsuit also covers AT&T, due to accusations of forcing customers to sign two-year service contracts, which have US$ 175 termination fees attached to them. Li then goes on to say that it was unfair simply because those who purchased the iPhone were able to use unlocking applications that freed them from the contracts.

This may seem like a story of another day, another lawsuit, but we do hope that this gets resolved properly, and soon.

Steve Jobs has recently stated that Apple will be cracking down on unlocked iPhones. Apparently, the method they have chosen to do so is through firmware updates they plan on releasing for iPhones.

The group of hackers (iPhone Dev Team) who developed the unlocker have responded to this statement through a representative saying that they will be releasing a tool that will restore the unit's nck counter, seczones, and even restore the phone to factory settings.

In the meantime, they told the rest of the community that they shouldn't upgrade their firmware when the update comes out. Instead they ask unlocked iPhone owners to patiently wait for the next version of the crack to avoid breaking their mobiles. In the same statement, they also spoke about how Apple is allegedly misinforming their customers:

Apple now announces that the next firmware update, expected later this week, will possibly break the handset of all of us free users in the World. It speaks of "damage" done to the firmware and "unauthorized access" to our own property, The removal of those firmware problems, which were built in in favor for AT&T, does not cause "damage" as they want to make us believe.

So the battle between the corporations and hackers continue. The community has already been polarized with some siding with Apple and others with the iPhone Dev Team. We'll keep you guys updated on this as more news comes out.

Downloadable programs on the internet geared toward opening the Apple iPhone to mobile service providers other than AT&T's Cingular could harm the gadget beyond repair. That's a warning issued by Phil Schiller, Apple's head of worldwide product marking.

In a report by Reuters, Schiller says that their iPhone was designed exclusively to work with the AT&T service, and hacking the mobile device opens up a lot of risks.

"We are not doing anything proactively to disable iPhones that have been hacked or unlocked," he tells the press, as he implied that applications created by unofficial sources could be doing the real damage.

The iPhone is one of the world's fastest-selling electronic devices with 270,000 units flogging in the first two months alone. The Cupertino, California company expects a million of the devices to fly off shelves by the end of the year.

"Apple strongly discourages users from installing unauthorized unlocking programs on their iPhones," concludes Schiller. A new software update for the iPhone is in the pipeline but details are yet to be revealed.

It seems Vodafone is set on giving the iPhone a run for its money in Britain. While the iPhone is yet to hit British shores, Vodafone is already gearing up their own music download service that would compete Apple's own. They are now looking to other mobile phone manufacturers like Nokia to spread their service.

It was once believed that Vodafone will be providing the exclusive network service for the iPhone as AT&T did for the US, but analysts now suspect this won't be the case.

Instead of the exclusivity deal, Vodafone may in fact pull through with the music download service as they have already signed an exclusive deal with the British music firm Omnifone.

Vodafone's new service will offer certain handsets the option to download an unlimited number of songs from a selection of 1 million for a weekly fee of GB£ 1.99 (around US$ 4). The service will launch later this year and will be available for 2.5G and 3G compatible phones from Vodafone.

 

For those of us who were a little miffed at the sudden price drop of the iPhone a mere two months after its release - a hefty US$ 200 being slashed off its price tag - Steve Jobs has heard our cries, and he's doing something about it. Enter his most recent open letter to the iPhone-wielding public, apologizing as well as listing out the reasons why Apple, as a company, decided that the price cut was indeed a smart move to make.

So why the price cut? Here's Steve to tell you just what with this unedited portion of his open letter:

First, I am sure that we are making the correct decision to lower the price of the 8GB iPhone from $599 to $399, and that now is the right time to do it. iPhone is a breakthrough product, and we have the chance to 'go for it' this holiday season. iPhone is so far ahead of the competition, and now it will be affordable by even more customers.

It benefits both Apple and every iPhone user to get as many new customers as possible in the iPhone 'tent'. We strongly believe the $399 price will help us do just that this holiday season.

It's not to annoy the customers, that's for sure, but to make the iPhone more accessible and more affordable to the rest of its targeted demographic. Also, with the holiday season right around the corner, wouldn't you want to have the ability to give your loved one the iPhone he or she had been dreaming about?

That' not the entire thing about the open letter, though. Besides the apology and the reasons, Steve also offered something in return for those of us who stood in line for the iPhone:

Therefore, we have decided to offer every iPhone customer who purchased an iPhone from either Apple or AT&T, and who is not receiving a rebate or any other consideration, a $100 store credit towards the purchase of any product at an Apple Retail Store or the Apple Online Store.

Details are still being worked out and will be posted on Apple's website next week. Stay tuned.

A US$ 100 store credit for an apple product, both in the retail and online stores? That's quite a steal, especially if you're planning to buy one of Apple's latest gadgets. See, people do listen, and Steve Jobs certainly did.

You can check out the full open letter at the read link below.

Research group iSupply reports that Apple's popular iPhone has sold more handsets than any other smartphone this July. The group also expects the device to come out on top of the feature phone category when the year ends.

The iPhone beat Research in Motion's popular Blackberry models and dominated models from rivals Nokia and Motorola in the smartphone category which encompasses models that have computer-like features.

Under the feature phone category where units with recreational extras such as cameras and mp3 players are classified, the iPhone equaled the sales of market leader Chocolate, manufactured by Korean consumer electronics giant LG.

The iPhone is considered by iSupply as a crossover between the two major mobile phone types due to the diversity of the features included in it.

The firm projects around 4.5 million units of iPhone sold by year's end and suggests that 20 million units could be in North American homes in four years.

Telecom giant AT&T saw a quarter of all iPhone users jump to its fold by virtue of its exclusive deal with Apple. Worldwide sales are expected to pick up even more when the iPhone hits Europe in the last quarter of the year.

Looks like the iPhoneSimFree group, who claimed to have hacked the iPhone a week ago, isn't hampered by the same legal dilemma as UniquePhones. The company has developed a software-only unlocker for the iPhone which they will be releasing within the next 48 hours.

To satisfy doubters, iPhoneSimFree is also holding a contest where three winners can have their iPhones unlocked for free. No definite price has been announced yet but they will be offering as many payment options as possible. They are confident that it will do its job but they don't offer a money back guarantee if Apple chooses to lock the device again in the future.

They claim that the only difference between pre- and post-unlocking the iPhone would be the Visual Voice Mail which is an exclusive feature of AT&T. Whether or not AT&T will be able to delay or entirely halt the operation before its release like it did for UniquePhone's unlocking software is still in question. Most likely we'll hear about it within the next 48 hours.

Just a few hours before its release, UniquePhones' iPhone unlocking software was pulled out because of a call from AT&T which hinted at legal action should the program find its way to the public. The software, which would allow the iPhone to use other wireless carriers besides AT&T, would probably not be released.

According to research conducted by Ars Technica, using the software to unlock phones is ok but distributing it is not. Cell phone unlocking is not uncommon and is in fact legal according to the Digital Millennium Copyright Act (DMCA). It's the user's privilege to allow the phone to connect to any carrier; that's what cell phones are for in the first place.

The DMCA, however, does not address direct distribution of unlocking methods and software and so provides no protection for those who release them to the public. This places UniquePhones in a rather vulnerable state, stuck in a legal gray area that AT&T can exploit.

At least, it's legally vulnerable in America where AT&T fiercely guards its territory. UniquePhones may find that distribution in other countries may have a lot more legroom.

An anonymous person is offering US$ 100,000 to any developer who would release software that would unlock the iPhone and distribute it to everyone, free of charge.

Apparently fed up with how developers charge people who are interested in iPhone unlocking software, the person claims that s/he got support from people hailing from other countries and managed to raise US$ 100,000. The money will apparently be given as a reward to any software developer who would freely release the software to everybody in the world.

The offer also includes free control of a domain (most probably for the free distribution of the software). This person assured that AT&T will not be able to do anything (probably regarding legal issues) once the software is widely distributed.

So, are you up for the challenge? Word to the wise: this offer sounds a bit shady, so do take precautions if ever you're interested. You don't want to put yourself into a nasty bind. More details about the offer can be found by clicking on the Read link.

After receiving US$ 2000 worth of roaming charges from AT&T, Herbert H. Kliegerman decided to sue Apple for not properly disclosing to customers that the iPhone is locked to AT&T, and the use of the handset in other countries will result in roaming fees.

A frequent traveller, Kliegerman travelled to Mexico and continued to use his iPhone. Not aware of the roaming charges applicable when using a local network provider's service internationally, Kliegerman was content that he will not be charged extra for using internet and checking emails. However, he received the US$ 2000 bill upon his return from the trip.

Kliegerman contacted AT&T to have his phone unlocked, but since iPhone is exclusive to AT&T for the meantime, AT&T refused his request to unlock his phone. Disgruntled, he filed a 9-page complaint in a New York Supreme Court and accused Apple of deceiving customers by not properly informing them of the iPhone's exclusivity with AT&T, and about the roaming charges as well.

Here's a short quote from the lawsuit:

As a result of [Apple's] deceptive and misleading acts, members of the Class have been injured because they are unable to unlock their phones for use with non-AT&T SIM cards.

It looks like it's another day, another lawsuit for Apple and the iPhone. However, it looks like this particular case would have been avoided with a careful reading of the contract before signing anything.