Its an IMEI issue. In my case, about a year ago, after originally purchasing my iP4 from AT&T store, I had a prox. sensor issue. Went to the Apple Store, they replaced the phone. Here is where it all stems from. The IMEI of the new phone was never updated in AT&T/Carriers systems. For iOS updates prior to iOS5, this was not an issue. My phone did its iOS updates along the way with no probs. However, when I updated to iOS5, the firmware did not match the IMEI with what AT&T/carrier had. When I went to Apple Store for the issue about 3 days ago and was given a new phone....again....the new phones IMEI was never updated with AT&T/carrier. I then again attempted the upgrade to iOS5 with the new phone and iOS5 bricked that one also. Today, at the store, we tried 3 replacements with same outcome.
So, after 4 hours and 3 replacement phones with Apple Store Tech (BTW totally gobsmacked), we solved the issue. Luckily, due to iPhone 4S launch, there was an AT&T guy there with a computer tied to the AT&T network to work along with us. The issue is......once the IMEI's on carrier account and phone do not match, iOS5 shuts down the sim card reader within phone.....forever. How to reverse this?......this is a question Apple needs to come up with, because with my case, they have 5 "bricked" phones.
What solved the issue was to get a new phone with iOS4.3.5, new SIM from carrier/AT&T, have carrier/AT&T (in their system) change/match the IMEI to the new phone and activate new SIM. Then, do iOS5 upgrade.
Simple and makes total sense..........however........there is an internal firmware (Apple Security??) issue that bricks the phone once IMEI's dont match.
I am now on iOS5.....no problems......so far. Good luck to all others.