Article quoted from Sophos. To view the original article check http://www.sophos.com/blogs/gc/g/2009/11/08/iphone-worm-discovered-wallpaper-rick-astley-photo/

Apple iPhone owners in Australia have reported that their smartphones have been infected by a worm that has changed their wallpaper to an image of 1980s pop crooner Rick Astley.

The worm, which could have spread to other countries although we have no confirmed reports outside Australia, is capable of breaking into jailbroken iPhones if their owners have not changed the default password after installing SSH. Once in place, the worm appears to attempt to find other iPhones on the mobile phone network that are similarly vulnerable, and installs itself again.

On each installation, the worm - written by a hacker calling themselves "ikex" - changes the lock background wallpaper to an image of Rick Astley with the message:

ikee is never going to give you up

What's clear is that if you have jailbroken your iPhone or iPod Touch, and installed SSH, then you must always change your root user password to something different than the default, "alpine". In fact, it would be a good idea if you didn't use a dictionary word at all.

The worm will not affect users who have not jailbroken their iPhones or who have not installed SSH.

Check the whole article from: http://www.sophos.com/blogs/gc/g/2009/11/08/iphone-worm-discovered-wallpaper-rick-astley-photo/