There's also a more traditional crack which allows apps to be stripped of DRM and shared without using iTunes, although you'll have to jailbreak your phone to do it. The first app to be widely pirated is Super Monkey Ball, which isn't surprising, and it seems like several other apps have followed it out onto various torrent sites. In addition to the relatively simple jailbreak procedure, running cracked apps requires you to open up SSH access and do some mucking around, so unless your time is worth less than $10, it's probably not worth it. Still, we've got a feeling that won't stop the hardcore pirates out there from doing their thing, and it'll be interesting to see how Apple deals with the problem -- we'd bet that it just looks the other way.
Finally, all these DRM-related restrictions have led to a lot of speculation about offering open source apps under the GPL in the App Store. Since the GPL generally forbids any restrictions on redistribution, it would seem that FairPlay's restrictions would put a software author on pretty shaky ground if they use GPL code in an official iPhone app, as they would have to violate the terms of the GPL by putting the final app in the store under FairPlay without source. Furthermore, even if an iPhone coder starts clean and doesn't use existing GPL code, they can't choose to license the app under the GPL separately from App Store distribution, since sharing source is against Apple's iPhone SDK NDA. Of course, it's not really like open-source devs to sit around getting bogged down in legalities -- Wordpress has already put up all the code for its official iPhone app under the GPL, and it would be a pretty stupid PR move for Apple to ask for it to come down. The only true solution for Apple would be to drop the NDA and allow some apps to be distributed and shared without FairPlay, but that's not going to happen overnight -- and even then there will be logistical and legal hurdles to overcome. In other words: rock, meet hard place.
Funny, these are exactly the sorts of ridiculous, illogical, and inane problems you get when you start screwing around with DRM -- but you already knew that, didn't you, Steve?
Read - Sharing iPhone apps
Read - Super Monkey Ball cracked
Read - Wordpress code released under GPL