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A security research firm has discovered several security problems with PayPal’s iPhone app, warning that hackers can use man-in-the-middle attacks to steal sensitive user data.

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According to an audit of the app by Chicago-based viaForensics, the vulnerability stems from the app’s failure to confirm the authenticity of PayPal’s website when communicating over the Internet.

Without that confirmation, a hacker could electronically step between a user and PayPal, pretend to be the PayPal website and gather usernames and passwords. The hacker would need to be in the same physical location as the user or have gained access to the same Wi-Fi network.

In practice, that could mean setting up a Wi-Fi hotspot in a location, such as a train station, and waiting for someone to use the network for a PayPal transaction on their iPhone app. It would be a fishing expedition, but the equipment and software needed is commonly available.

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Apple recently took an axe to Murderdrome, an electronic comic book in its App Store that the company deemed too violent. Murderdrome, created by the United Kingdom-based Infuriouscomics, had been created especially for the iPhone. Apple turned down Infuriouscomics' application to put the comic in the App Store.

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AT&T will begin offering the iPhone 3G phones at its retail stores beginning July 11 at 8 a.m. local time. AT&T is the exclusive iPhone carrier in the United States. Under its offering, the lower price will be available to only customers who purchased an iPhone before July 11, or are activating a new customer line with AT&T, or are eligible for an upgrade at the time of purchase. Customers also are required to sign a two-year contract. AT&T customers who are not eligible for an upgrade discount can buy the iPhone 3G for $399 for 8GB model, or $499 for a 16GB version, under a two-year contract. Customers who purchase the phone without a contract would pay $599 for 8GB or $699 for a 16GB.

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Few people who pay even scant attention to the technology industry could claim to be shocked by the introduction of a faster iPhone earlier on Monday by Apple CEO Steve Jobs. Apple has sold 6 million iPhones since June 2007, Jobs said, and will likely sell a few more once the new model arrives on July 11 with a faster networking chip, GPS capabilities, and a software upgrade that's an IT manager's dream for a mobile device.

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Apple said today that a firmware update to the iPhone due to be released later this week "will likely result" in SIM-unlocked iPhones turning into very expensive bricks. "Apple has discovered that many of the unauthorized iPhone unlocking programs available on the Internet cause irreparable damage to the iPhone's software, which will likely result in the modified iPhone becoming permanently inoperable when a future Apple-supplied iPhone software update is installed," said Apple in a statement issued this afternoon.

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Even though he takes issue with the price cut and how it was handled, Wozniak said he is a big fan of the iPhone. "I fell in love with the iPhone," he said. "I did not like it at first." Wozniak said it took him a month to fall in love with the device. He said he also "loves the Blackberry Pearl because it is such a small size. The iPhone is bigger, but boy that iPhone is more fun even when it's slower at dialing phone calls." Wozniak said he still has not switched the phone he primarily uses for voice over to the iPhone because of the "voice quality, being able to hear it." What's more, he said, the iPhone doesn't work with the BlueTooth (wireless hands free) technology he loves so much."I like to be hands free and my voice dialing is not built into the iPhone yet," he says. "I expect that soon."

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Safari's security model prevents JavaScript in remote web pages from modifying pages outside of their domain. A race condition in page updating combined with HTTP redirection may allow JavaScript from one page to modify a redirected page. This could allow cookies and pages to be read or arbitrarily modified. This update addresses the issue by correcting access control to window properties. Credit to Lawrence Lai, Stan Switzer, and Ed Rowe of Adobe Systems, Inc. for reporting this issue.

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AT&T's second explanation was that Apple's 270,000 iPhones included sales of iPhones through Apple's online store, which obviously couldn't have been activated the first weekend since Apple is quoting two- to four-week lead times for iPhones ordered online. But Apple Chief Financial Officer Peter Oppenheimer specifically said on the conference call that the 270,000 units reflected only iPhones that were sold to AT&T for distribution through its network of retail stores and iPhones sold through Apple's retail stores. No iPhones sold through Apple's online store were included as part of that 270,000 unit figure, the company later confirmed.

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"I do have trepidation about switching from Verizon to AT&T, but I figure Steve Jobs wouldn't have made the deal if he couldn't back it up," she said. "Verizon has one of the largest networks, but AT&T has the iPhone." The 36-year-old, who owns a graphic design business with her husband, said she needs the iPhone for e-mailing, Web access, and sending and receiving files--all functions she could easily do with another device like a Treo or BlackBerry, which are already sold through Verizon Wireless. But as a Mac user for more than a decade, she admits she is drawn to anything created by Apple and Apple CEO Steve Jobs.