Verizon's iPhone 5, which is sold on contract, is unlocked for use on GSM networks, which allows users with a nano-SIM from a GSM carrier to use the smartphone on other networks.

"I can confirm that the Verizon iPhone 5 is indeed GSM unlocked. Even though I bought an iPhone 5 from Verizon under contract, I was able to cut down my AT&T Micro SIM, and use it in my Verizon iPhone 5 to pick up an AT&T signal. By doing so, I was able to hop onto AT&T's HPSA+ network, or '4G' as they so ridiculously name it," indicates a blogger of iDownloadBlog.

Most iPhones are tied to the carriers from which the customers bought the smartphones. As such, if an iPhone is bought from a specific carrier, it will not run on any other network. However, the blogger states that Verizon confirmed to him that an iPhone 5 taken from Verizon can work using any other SIM card.

Previously, Verizon indicated that future iPhones will be dual-mode capable, which means that iPhones will work on CDMA networks (like Verizon) as well as GSM network (like AT&T & other global GSM networks).

This could be good news for iPhone 5 users who travel outside the U.S. Many U.S. networks are CDMA, compared to the European standard GSM technology. Now travelers from the U.S. will be able to use their iPhone 5 outside the country, provided that the handset is not locked to the carrier.

Whether Apple is trying to attract more customers by offering dual-mode capabilities in the latest iPhone 5 is anybody's guess.