Almost all the iPhones in circulation are factory locked devices. This means they were locked by Apple, at the request of the network that supplied the handset as is was sold at a heavily discounted rate. In every country that Apple offer the iPhone, they have signed agreements to supply locked handsets to the major cell phone networks. This means that if you purchase an iPhone from AT&T, you will only be able to use it on the AT&T network, but you will be able to purchase it direct from AT&T for up to five times cheaper than you would buying an unlocked variant, directly from Apple. The networks have become some confident in the knowledge that they can and will recover this money of the length of a contract, that they are willing to provide customers with iPhones for mere pennies in some cases!
That all sound great, being able to get an iPhone at a fraction of the cost it would be if you bought it from Apple, but what if you want to use your phone on another network? You could find yourself in a cellular black spot where coverage is poor to non-existent.

Before July 2011 you had two alternative methods you could use to unlock an iPhone . Back in the day it was possible to software unlock an iPhone. Nowadays the only option available is the factory unlocking method. Not surprisingly the software hacking unlock method was only a temporary method which required reapplying every time the phone was rebooted.

Not only did the software unlock become obsolete back in July 2011 when Apple successfully closed the loophole in the iOS that hackers had exploited to make it work, but many people that used this method of unlocking didn't realize that in doing so they had invalidated their iPhones warranty. Although, in theory, it is still possible to use software to unlock an iPhone, the phone would have to be an iPhone 4s (or earlier) and it would have to be running firmware no fewer than 5.1.1.

However, the best unlock