iPhone Hackers: "we have owned the filesystem"

The kooky hacking kids over at IRC channel #iphone claim to have gained full ownership of the iPhone filesystem. In an update titled "How to Escape Jail," they highlight the technical steps required to enable custom ringtones, wallpapers and more for your iPhone. They have not released a tool for general consumption -- yet -- but do provide the picture above as evidence of their hacking skillz.

Update: Video proof of a customized ringtone after the break.