I've googled extensively looking for a fix for this, I've found many problems SIMILAR to mine but none exactly the same so I'm going to give as much information as possible. I bought an iPhone 3GS (32G) second hand from a friend. It was locked to a network which was not my own, so I took the phone to a small phone repair shop where they unlocked it for me for $50. After this, it worked perfectly. I synced it to my own iTunes and everything was fine. A few weeks after using it, my iTunes offered an update to iOS 4, I clicked it thinking the phone would update to the latest software, and continue to work fine. However, when the update was complete I had this error in iTunes.... The SIM card inserted in this iPhone does not appear to be supported. Only compatible SIM cards from a supported Carrier may be used to activate iPhone. Please insert the SIM card that came with your iPhone or visit supported Carrier’s store to receive a replacement SIM card. I disconnected my iPhone and ever since then the phone will not detect my carrier. It works now like an iPod touch. It cannot make/receive calls or texts, or connect to the internet. I have tried to restore however I get an unknown error saying the phone cannot be restored (error code 2001) I have tried jailbreaking it, downgrading back to 3.1.3...(this didn't work due to error- "This device isn’t eligible for the requested build") I even took it into a store of my carrier, told them of the error, and they replaced my sim saying it may fix the problem, but to no avail. Does ANYONE know ANYTHING that can help me? I use a macbook aluminium OS X 10.6.5 I cannot take it to an Apple store because it is second hand, and jailbroken, so I know they won't fix it. Is it time to give up?