Step 1: Update your iPhone to the iPhone 2.0 software using iTunes.

On a Mac, plug in you iPhone, enter iTunes, click on the iPhone via devices in the sidebar. You’ll see Version and some buttons, if it isn’t telling you your iPhone is up-to-date, click Check for Update. If it has detected the need for an update, update the phone to 2.0.

Step 2: download and run Pwnage 2.0

Download available here or visit the iPhone Dev team site here for mirrors if this link isn’t working. Safe rule is to download from a mirror on the site, not others, as you don’t always know what you get.

You’ll also need to download the Bootloaders here.

Run Pwnage Tool (look for a pinnaple icon in your downloads folder).

Step 3: follow instructions

The Pwnage Tool may ask you for your iPhone file and Bootloaders, or it might find them no problems. Point them in the right direction. You have downloaded the bootloaders, and iTunes will have a copy of the 2.0 firmware

Step 4: Don’t panic

The Pwnage tool will compile a new loadable version of the firmware for your phone. When asked “are you legit iPhone,” hit no if you’re upgrading from a jailbroken iPhone. This is very important in activating the phone later, I was thrown by it the first time and hit yes. If in doubt, hit no anyway.

The Pwnage tool may ask for a system password, this is to write the new file, give it to them.

The last stage here will ask whether your iPhone has been pwned before. This is for users who have unlocked the iPhone previously with earlier versions of the Pwnage tool. I previously used ZiPhone so I hit no, if in doubt, hit no.

Step 5: DFU fun

The Pwnage tool will now try to put your phone into DFU mode presuming you hit no to the last step. This is where it got hard for me.

Firstly I couldn’t get it to go into DFU mode at all, and continually got a failure message. The trick to get past this stage is to enter terminal, and enter the following:

mkdir “~/Library/iTunes/Device Support”

Simple as that. If you are caught here just start the process again, follow the steps, and you’ll get to the same screen. At this stage the PwnageTool walks you through how to put your phone into DFU mode. I tried this over and over again with absolutely no luck. It turns out that at this stage you have the file anyway, so you don’t have to use Pwnge to put the phone into DFU.

Step 6 (if required) put your phone into DFU manually

Attach the phone to your Mac
Turn the phone off
Hold power and home together for 10 seconds exactly
Release power but keep holding the home button until iTunes pops up and recognizes the phone.

and that’s it. Note in DFU mode you should see nothing on your screen, if you see anything, try the steps again.

Step 7: restore using iTunes

iTunes will deliver a message along the lines of “phone in restore mode.” At this stage you need to restore the phone using the file Pwnage has created. To do this, click on the Restore button in iTunes while pressing the Option key, doing it this way allows you to pick the restore file for your phone. Pick the file from your desktop of where ever Pwnage created it, then let iTunes do its thing.

Step 8: patience

At this stage you just have to sit back and let the software install. You’ll hit some screens on your iPhone about flashing memory, loading bootloader etc, the only tip here: just don’t touch or unplug your iPhone during this process.

If you’re more comfortable with pictures, Sleepers.net has a walk through here.

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The new iPhone App Store will feature a slew of new applications and opportunities for developers. The store will offer wireless download support and automatic updates. It will allow developers to keep 70 percent of the revenue earned from their sales. The store will be available in 62 countries and will offer cell network downloads for all apps 10 megs or less. Larger apps will require WiFi or iTunes for downloading. The store will also let corporations distribute company-specific apps just to their employees.

Several companies revealed new applications under development:

• Sega’s updated Super Monkey Ball game will feature more than 100 levels and added tilt control. Representatives said it will sell for $9.99.
• eBay’s new iPhone Auctions utility will let you monitor all your auctions from a single main screen. The tool has been in development for only about five weeks, reps said.
• A location tracking social network called Loopt will let you use cell data to pinpoint your friends’ current locations on a graphical map. The software even goes as far as showing a history of where a contact has been, as well as any photos they’ve submitted. Loopt will have cross-platform support with other phones and will be made available free when the App Store opens.
• The updated TypePad app — also free — will provide an interface for blogging or photo uploading.
• The Associated Press will offer a Mobile News Network that will use the phone’s location API to gather content from nearby sources. It will also provide news video and photo viewing and will give you the option to submit your own photo- and text-based reports. This service will also be fee-free.
• Pangea Software has two new game offerings, Enigmo and Cro-Mag Rally. The latter is a 3D racing experience that turns the iPhone into a steering wheel. Each game will be $9.99.
• Band aims to play off the popularity of music-based gaming with a virtual studio of sorts that will let you play a virtual piano, drums, guitar-style “blues instrument,” or bass. You can even record your tunes.
• MLB.com has a new live score utility that will deliver real-time highlights immediately after each play.
• Several medical tools are in the works, including a learning program that helps you remember body part names and a touchscreen-based app to view 3D medical images.
• Digital Legends has a new 3D fantasy adventure game. The company says its program will use OpenGL and touch controls to take mobile gaming to a whole new level. The app is still under development but is expected to be ready by September.

Apple also announced the creation of a new push notification service for developers. When a user exits an application, Apple will “push” updates from its servers — sent by the developer — to the user’s phone. The updates could include custom messages or badges and sounds. The function will be ready in September but will be delivered to developers sooner.

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Another major feature being included is MobileMe, billed as “Exchange, for the rest of us.” The program, replacing .mac, mimics the functions of ActiveSync — letting you keep your contacts, calendars, and email automatically synced with your computers. It interacts with Mail, iCail, and Mac Address Book as well as with Microsoft Outlook. It also includes several Web 2.0 applications that work with its me.com web interface. A 60-day free trial will be available when the software launches, and current .mac users will receive an automatic upgrade.

Other changes include the addition of live contact searching, iWork document support, Office document support, and bulk delete and move commands for messages. A new scientific calculator is also being added, along with expanded language support featuring on-the-fly switching.

iPhone 2.0 will utilize Core OS, which Apple’s Scott Forestell said will make it easier for developers to build location-based functions into applications. It will include several APIs, such as Cocoa Touch — a tool Forestell touts as the simple solution to creating advanced UIs. Forestell demonstrated how the program could be used to build an application called Nearby Friends, which would actually show you all contacts who are within a 10 mile radius of you.

A handful of practical and recreational third-party applications are already being announced for the new software.

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The iPhone 3G will be released July 11 in 22 countries: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Italy, Japan, Mexico, Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, the UK and the United States. The black 8GB model will be marketed at $199, while the 16GB version — to be made available in either black or white — will go for $299.

The new phone will be a smaller and sleeker design with solid metal buttons and the same large display. The added 3G support will mean data downloads almost three times faster than EDGE speeds, Jobs said. The iPhone 3G is also 36 percent faster than other comparable phones like the Nokia N95 and Treo 750, according to Apple. It will also add integrated GPS support, which will allow for “tracking” — a moving dot on a real-time Google map showing your location.

The updated model is said to have 300 hours of standby battery life and double the amount of talk-time as its predecessor, with five full hours. It will offer five to six hours of high-speed browsing, seven hours of video, or 24 hours of audio without the need to recharge.

Jobs said the updated phone will include fully built-in enterprise support, third-party application support, as well as support for more countries than ever — now 70 total — thanks to the many added features in the upcoming iPhone 2.0 software package, also announced Monday along with a slew of new third-party applications.

Apple is hanging onto its goal of 10 million iPhone sales by the end of 2008 — a mark that will no doubt be made easier once the new phones hit store shelves.

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