In a move that could have serious implications on iPhone users around the world, Apple on Thursday released iPhone software update version 1.1.1, which adds access to the Wi-Fi iTunes Music Store and several other features.

Along with the iTunes store, the 152MB update also increases speakerphone and receiver volume; adds a Home Button double-click shortcut feature; adds a space bar double-tap shortcut that lets the iPhone intelligently insert a period or space; and allows Mail attachments to be viewable in portrait and landscape, among many other updates.

Unlocked iPhones now inoperable

But perhaps the most staggering update to the iPhone is the company's decision to disable unlocked iPhones and remove any third-party applications added to the device.

According to reports, firmware version 1.1.1 restores the unlocked iPhone back to its pre-activation state and so far, no one has been able to reactivate the device with the original AT&T SIM card. Ostensibly, these updated iPhones are only capable of making emergency calls.

"If you have modified your iPhone's software, applying this software update may result in your iPhone becoming permanently inoperable," Apple re-warned customers in the release notes accompanying the software download. "Making unauthorized modifications to the software on your iPhone violates the iPhone software license agreement, and the inability to use your iPhone due to unauthorized software modifications is not covered under your iPhone's warranty."

Additional features include:

  • Stocks and cities in Stocks and Weather can be re-ordered
  • Apple Bluetooth Headset battery status in the Status Bar
  • Support for TV Out
  • Preference to turn off EDGE/GPRS when roaming internationally
  • New Passcode lock time intervals
  • Adjustable alert volume

The new update also fixed ten security holes and Bluetooth compatibility issues.