How do local companies factory unlock in-contract iPhones?

They claim they can unlock my in-contract iPhone 4s for anywhere from $50-$100. How can they do this I'm just curious.

Carriers write a file to the phone's storage that checks the carrier and SIM data against their own. Stores just use a system that deletes or overwrites this data, allowing it to be used on any network of the same type.

A general description of what goes on (and how to do it yourself) is at http://www.pcworld.com/...phone.html. The software may be out of date (it's from 2008) but a quick search online (look for tech forums, not something like unlockurphone.com, where it'll probably be "pay us $50 to do it!") will give instructions.

It's easy… Go here: http://www.unlockcellphonecode.com/

They can't.