Dev-Team Blog
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3GS — ultrasn0w style! 

Do not upgrade to 3.1 yet if you want this unlock!

Here’s a brief video demonstration by @planetbeing of the iPhone Dev Team’s ultrasn0w unlock for the new iPhone 3G S. Special thanks to @Oranav for the at+xlog crash — a gift to the community that has kept on giving!

Our ultrasn0w program uses the at+xlog crash as an injection vector of our unlocking payload — and it does so on the 3GS in exactly the same way as on the 3G!  But this injection vector will be lost if you update to 3.1 using the official Apple IPSW, which updates the baseband.  So stay away from official 3.1 IPSWs until we release the tools that let you update the firmware without updating the baseband.