DO ALL THIS WITH YOUR THIRD PARTY SIM INSERTED ALSO YOU WILL NEED WIFI IN ORDER TO INSTALL SBSettings and Yellowsn0w
1. Connect your phone to Mac/PC
2. Launch Itunes
3. Put iPhone into DFU Mode
Get the iPhone into DFU mode: When in this mode the iPhone screen is black.4. Command + Restore to stock apple 2.2 ipsw (mac). Shift + Restore to stock apple 2.2 ipsw (windows)
3.1. Connect the iPhone and your Mac/PC
3.2. Shut down iTunes
3.3. Hold Power/Sleep until the red slider shows up, slide to shut the iPhone down. If this aint work hold Power/Sleep and Home until the iPhone shuts down.
3.3.1. Hold Start/Sleep and Home for 10 seconds (I count like 100, 200, 300, ..)
3.4. Let go of Start/Sleep but keep holding Home until...
3.5. ... iTunes starts up and finds an iPhone in restore/recovery mode. The iPhone screen is black.
5. Disconnect iPhone from Mac/PC before it reboots after the software restore
6. Close iTunes and reconnect iPhone
7. Run Quickpwn and let it do its magic. QuickPwn for mac and windows can be downloaded from 8. Disconnect iPhone from your Mac/PC.
9. After jailbreaking your iPhone with quickpwn go to Settings --> General --> About and verify that the Carrier field displays (null)(null). If theres other thing than (null)(null) in the carrier field your iPhone activated itself to your locking carrier. Start all over again.
10. Launch cydia. after the first run restart ignore the upgrade essential prompt and install SBSettings
11. Go to Manage-->Sources and add the yellowsn0w source and install yellowsn0w 0.9.6
12. Press home button and return to your Home Screen
13. Go to Settings --> General --> Reset --> Reset Network Settings. This will automatically reboot your iPhone. If not proceed as follows.
13.1. Slide your finger over the status bar when the SBSettings panel pops up tap over power and tap reboot in the following prompt.
14. Wait 5 - 10 seconds from when you see the slide to unlock screen after reboot.
have signal already??? no??? ... then keep going.
15. Turn on airplane mode for 10 - 20 seconds
16. Turn off airplane mode
17 Be Happy!!!
Many thanks to dev team for this breaktrough and all the effort made on bringing yellowsn0w to life. Happy New Year.
Credits: Get the iPhone into DFU mode info taken from volkpost post.