The latest version of YellowSn0w is now out. Released by the iPhone Dev-Team, the 0.9.5 beta yellowsn0w 3G unlock application will allow you to unlock an iPhone 3G running the 2.2 firmware.
The application is a small daemon that is launched on boot. It injects the payload at boot and also whenever there is a baseband reset. You won’t notice anything about it other than that your third-party sim now works. It’s a small program and unobtrusive.
Note that this software is still considered beta by its developers and still has a few issues that the team is working through. Having said that, quite a few users are reporting success with it.
One benefit of unlocking your SIM is that you can now use a local pre-paid SIM when traveling. No more roaming charges!