In the week or so since the iPhone has been on the market, hackers have:
1. discovered the root password for the device, which is "Alpine";
2. found another password for the mobile user account, which is "Dottie"; and
3. posted a workaround to the AT&T (NYSE: T) activation, so new owners can bypass AT&T's fees -- although they also bypass AT&T's wireless connectivity, turning their new device into the world's most expensive iPod.
The workaround, provided courtesy of "DVD Jon" is, at worst, a nuisance for AT&T and Apple (Nasdaq: AAPL). The discovery of the two passwords, which cannot be changed since they are hard-coded into the machine, is a more serious matter.