there is no SIM card installed in the iphone you are attempting to activate

This means that your phone was originally carrier locked to O2 and had been unlocked by unauthorized methods.

It became re-locked to O2 when you updated. Your only choice is to get O2 to OFFICIALLY unlock it permanently.

The iPhone was sold as carrier locked with O2 when new, and this means the iPhone was hacked to be unlocked with any carrier's SIM card - the iPhone was not officially unlocked by O2 in the UK.

Installing a firmware update on an iPhone that was hacked to be unlocked or restoring such an iPhone with iTunes re-locks the iPhone to the carrier the iPhone was sold as carrier locked with when new - in this case it was re-locked to O2.

If the iPhone was officially unlocked by O2 in the UK, you need to contact O2 in the UK about this.

OK, do you have ANY SIM card in it? It will NOT activate without a SIM card. No exceptions. If it is carrier locked, only a SIM from the carrier it is locked to will work. If it is officially unlocked, I believe any SIM will work, but a SIM MUST be present.

Jetso wrote:

I do try insert Malaysia Maxis Operator Sim Card at iPhone3Gs it show:

I also do restore it back to same as above, anyone can advise?

Did you read the prior replies? You phone has been re-locked to O2 and your Malaysia SIM(or any other besides O2) won't work anymore.