Why does itunes say my sim card is not supported?

i have an at&t iphone i just picked up from the apple store yesterday with original at&t sim card that was working until after i restored my phone.  This is the 4th iphone this has happened to in the last month. i wanted to restore my iphone 4 to factory setting so i could set up as new iphone. i put a previous back up on it before. what is going on? a restore should not be rendering the sim reader in the phone useless. yesterday at&t tried 3 different sim cards and they did not work so apple replaced the phone.  the third replacement this month.  now ill have to take this new phone back.  i even tried uninstalling itunes and reinstalling it.  I have a macbook unibody (the last model before it was discontinued) running osx snow lepard

What is happening is that, as iPhone Warrior said, almost certainly your friend mistakenly purchased an iPhone that is locked to AT&T rather than an unlocked iPhone (which Apple only began selling a short time ago in the US) and then hacked the iPhone to bypass the carrier lock. When you updated iOS on the iPhone, that hack was removed and the iPhone then locked back to AT&T.
Restoring the iPhone will not fix this problem. Only the carrier could officially unlock the iPhone, and AT&T will not do so for any reason. The only way to use the iPhone again is to hack (jailbreak) it again, and we cannot discuss that in these forums.
Regards.

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