I was just on the phone with tech support. Having the same issue. She said it is currently a "known issue". Phone shows network, and bars but I am unable to place or receive calls, texts or access the internet. Says I am not subscribed to a cellular network.
Tech support said it was a problem with a "switch" and could be 24 to 48 hours. I told them this was ridiculous I have been a loyal att customer for many years. I could just cancel and walk in to Verizon and walk out with a working phone.
She offered my a $100 credit for not being able to use my phone. So frustrating. I have to be on the road very late tonight, and don't have another phone as backup.
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This worked for me, thank you!!
Also before when I tried to activate I set up my home wifi. This time I skipped wifi setup and "forced" it to try to activate over cellular.
Tried once and couldn't connect to finish
Turned off my phone and turned back on. Tried again (still forcing cellular and skipping wifi)
It had trouble connecting with my apple id so I said "skip this step"
BINGO it worked. I didn't have to do a full wipe more than once, but I DID have to try to connect several times.
Hope this helps someone
Spent an hour on the phone with AT&T. All they did was blame Apple and tell me to go into an AT&T store and have the SIM replaced. I got off the phone and did the following on my iPhone 5:
1. Turn new iPhone off then on again.
2. Go to Settings.
3. Go to General.
4. Go to Reset.
5. Select "Erase all Content and Settings".
6. Confirm "yes" to both confirmations that you want to do this action.
7. Allow the phone to erase completely, shutdown and re-start automatically.
8. After the full re-start, your iPhone5 will be back up and at the language screen, like out of the box.
9. Go through the activation steps as normal and prompted. (I went through an iCloud backup for prior iPhone).
10. Phone should have complete service after these steps.
Note: A few folks who have done this had to do a full wipe more than once. I had no problem with 2 new phones
first restore shot. Good luck!