I really don't see the point of all this.
1)If you lose your cell phone or it's stolen...it's gone. Period. You call your carrier and they prevent YOU from being billed on that device ever again. Then you go buy a new phone. Try not to lose/have your phone stolen again. That's life.
There's some potential for the device to be returned to you. I've read cases of people getting their phone back here in the UK.
Besides, this is not designed to help
after a device has been stolen, it's designed to make it less desirable to steal in the first place
2)The carriers are not doing this out of the kindness of their heart or a phone call from the police asking for help. What is to gain by the Carriers? Regardless if the phone is the owner's or lost/stolen, it still has to be registered on the Carrier's service (and pay a monthly fee) to use the service. At best the Carriers prevent some thieves/lucky folks from activating the free phone instead of buying one. And there's no problem at all if I activate/use a phone from my closet or a one a family member gives me for free. There must be more to the Carrier's true motives.
It's actually
bad for the carriers to some extent, because they currently make money from people who are using a stolen device (perhaps unwittingly). The only benefit is that it looks like they're doing something about mobile phone theft which is a big issue. They have the technical capability to make theft less desirable - not using it isn't good for PR.
3)If someone finds/steals a smartphone, even if the Carriers block them, the person has a nice smartphone missing the calling capability. Everyone knows that the iPhone, for example, is not a phone...it's a mini computer that CAN ALSO MAKE CALLS. I kept my old 3GS when I upgraded to 4S...I love that the 3GS still can do 100% of what it is supposed to do other than make calls. You think thieves are going to cry when they steal a $400 iPhone and turn around and sell it as a better-than-iPod-Touch unit? I don't think so.
This is true, but it will certainly reduce the amount of money thieves can get for a stolen device. That could mean that theft reduces, as it's no longer as lucrative as in the past. It should also mean that the general public, not intending to buy a stolen device, are much less likely to get caught out. If the device is blocked, then they know something is wrong.
4)So what are the procedures in place for mis-reported items? For example, you call and report it lost/stolen and then find it 24 hours later? Is it blacklisted forever? Is there a fee to make it work again?
With the IMEI db (also known as the CEIR - the international stolen device database), it's trivial (and free) for the owner of a device to get it unblocked in the event that they get the device back. The US system will probably work the same way.
I know a few people who have reported their phones stolen only to find them hours later and luckily didn't have a problem....so what about with this new program? How much personal info do they collect and why? (since all they truly care about is the phone ID so it can't be used again...the Carriers are not promising to help the police go get the phone if the phone tries to get activated).
The carriers don't need to collect any personal data - they already have it. They will ask the customer for the same sort of details that they ask at the moment when you report a phone lost/stolen.
The centralised database does not need to contain the customer's personal details - merely the IMEI of the stolen device.
5)I'm sure that a decent percentage of stolen phones will still be able to work on some(or original) carriers due to hackers altering something in the firmware to make it look like a different device or non-stolen.
It's possible to do this, but it's much harder on modern devices.
I'm not saying stop this program, but I see no need for it...even if #1 was my only point. Don't lose your phone. Buy an extended warranty coverage if you think you have a good chance of losing it.
The point is that in other countries where this system has been implemented, phone thefts have decreased or stalled - despite the massive explosion in devices being sold and used.
I think a better idea would be to have a Service that Apple offers that will brick the iPhone. The thief or person who found it can return it to the Apple store and Apple can contact the owner. If it's never returned, oh well. I believe Apple has something similar to this as far as software, but maybe Apple could promote it a bit more and make it as robust as possible. Maybe there's some kind of $25 non-refundable fee to report it lost/stolen so Apple recoups some of it's money for developing the software/service.
Apple could do this very easily (using the database system proposed, or the international system that exists), but they haven't tried to do it in the 5 years that the iPhone has been on the market, so I'm not sure why they'd change that now. As others have noted, they don't seem at all bothered about stolen devices - they happily honour the warranty on devices that they know have been stolen. As with the carriers, it's not really in Apple's interests to block stolen devices - they can provide a source of revenue.