UPDATED: iPhone won’t work in Europe yet
Update: As you may know, widespread unlocking methods are available now to unlock an iPhone from it’s SIM lock.Â
As I just read on the new AT&T FAQ for the Apple iPhone it looks like it won’t work in Europe yet. From the FAQ (notice the typo? 
):
Q. I’m an existing customer. Can I swap out my current SIM card and start right away?A. No. iPhone must be activated befroe it can be used. iPhone includes a pre-installed SIM card for your convenience. Â Â Â Â Â Â
So, it’s official now. The iPhone will have a pre-installed SIM card. Simply put, SIM cards are used by GSM providers to identify a user on the network. The SIM card usually associates the phone number to the device. The SIM card itself is associated to a user’s contract and is thus bound to a specific carrier.Phones with SIM card slots allow to change the number as well as the carrier by simply swapping the SIM card. Some phones, usually subsidized by the carrier, won’t allow you to insert the SIM card from a competing carrier and are thus called SIM-locked. This effectively forces the use of a phone on a very specific carrier. Subsidized phones can usually be unlocked after a certain period of time (like the minimum contract period) or by paying a fee, which allows to use the phone on a new network, should a user decide to do so. SIM-locking is bad, but at least it won’t degrade the phone to a paper weight, should you decide to change your carrier.Even worse than SIM-locking though, when a carrier like AT&T chooses to pre-install the SIM card, the phone will most likely be SIM-locked and the SIM card may not be swappable at all! This means that people won’t be able to buy an iPhone and simply swap the SIM card to use the phone on other networks or even use it with a local carrier in Europe. To bad, because it looks like we will have to wait another 4-6 months until we will get the iPhone on the old continent. Also, who knows if Apple will again choose to stick to an exclusive carrier like Vodafone. If so, they will probably have a hard time selling the phone over here, even though the demand would be pretty high. In Europe cell phones are even more regarded as a status symbol than in the U.S., but people in Europe are quite reluctant in changing their carrier, so if the phone is not available to be bought in retail without SIM-lock, sales will definitely be much lower than the actually could be. Sticking to one carrier not only limits the availability to a few countries (there is almost no carrier omnipresent in every EU country, not even Vodafone) but will also exclude lots of customers from other carriers even when an iPhone exclusive carrier is available in a specific coutnry.Since Apple seems to have a hard time to find a suitable carrier anyway (reports are, Apple’s demands for distributing the phone in Europe are too “arrogant” anyway), I really can only hope Apple fails to sign an exclusive contract with any European carriers. This would at least allow the customers to buy the phone - unsubsidized - for a higher price, but give them the flexibility of choice when it comes to the carrier.I really hope Apple will listen to the EU consumer as well and won’t be doing such mistakes over here!