It's understood that the phone was running iOS 7 or earlier, and thus did not enjoy the additional encryption measures added with iOS 8. But this is still a blow to Apple's reputation as a maker of ultra-private smartphones, at least until more detail emerges.
Of course, it's also an eye-opener for anyone who still believed that US law enforcement only wants to break into citizens' phones if they're involved in terrorist plots.
Update, 14 April: You remember that iPhone everyone was so excited about opening up? It turns out there was nothing useful on there after all.
CBS News quotes "a law enforcement source" as stating that so far, "nothing of real significance" has been found on the San Bernardino shooter's iPhone 5c, which was finally cracked last month by - it is alleged - a team of professional hackers. The FBI continues to analyse the data, and may yet make discoveries that aid in the prevention of future attacks, but that must now be unlikely. As it always was, incidentally, given that the attackers were acknowledged to be self-radicalised and not part of a cell.
So months and months of legal wrangling, threats and political grandstanding, and what are we left with? An old phone with the passcode deactivated, and an apparent software vulnerability that threatens the security of millions of iPhone owners around the world, but which Apple can't patch because the FBI won't tell them about it.
Update, 13 April: A further development. The Washington Post is now alleging that US law enforcement officials didn't hire Cellebrite at all; they hired a team of professional hackers.
Whether this is quite the ethical misstep that the word 'hacker' might imply is debatable: many hackers earn a reasonably respectable living seeking out software vulnerabilities and then selling that knowledge back to the vendor rather than using it for nefarious purposes. But the fact that the FBI still refuses to tell Apple about the vulnerability that was used to crack the iPhone - and thereby allow it to safeguard the millions of iPhone 5c models around the world from being cracked in the same way - raises broader questions about surveillance culture and the state's approach to its citizens' privacy.
This will also worry people who own an iPhone 5c, of course.
Update, 29 March: And that seems to be that. As predicted last week, the US Department of Justice and FBI have conveniently found another way into the phone and withdrawn their case against Apple. In a statement, the company said: "From the beginning, we objected to the FBI's demand that Apple build a backdoor into the iPhone because we believed it was wrong and would set a dangerous precedent. As a result of the government's dismissal, neither of these occurred. This case should never have been brought."
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