I remember cloning--what a mess that was!  We have lots of immigrants in
USA, and they all wanted to call back to the old country for free.  Gangs of
thieves would set up equipment in vans to intercept the ESNs of cell phones,
then they would program those numbers into dummy phones and the cellular
carrier had no way of knowing that the call was being made from a phone
other than the one that was signed up on the account.

Wireless phones are always "checking in" with the tower--especially after a
lapse of signal.  The thieves would set up vans near the entrances and exits
of tunnels, because as the cars came out, their cell phones would all
dutifully report their ESN to the tower, to tell it that it was available if
a call were to come in.  The thieves in the vans harvested thousands of ESNs
in just a couple of hours.

The cellular carriers originally started to suggest that people actually
shut their phones off when not using them--making them useless to receive
incoming calls, of course.

For awhile, some cellular carriers (Cellular One in the Philadelphia area,
for one) had their customers pick a secret 4-digit code.  Whenever the
customer dialed out, he would hear a beep tone on the phone, which was his
signal to enter the 4-digit code.  If the customer failed to enter the code
properly, the call would not be accepted by the tower.

This procedure minimized the usefulness of stolen serial numbers, but it one
more hassle for the consumer.  Entering those code numbers was a
pain--especially while driving.

Finally the phone manufacturers began implementing a new technology, called
authentication.  My understanding of it is very limited, but essentially
there was an algorithm deposited in the phone memory by the tower.  Let's
say, it was the number "2."  When the phone tried to dial out, the tower
would send a number to the phone, which the phone would multiply by the
number "2," and respond back with double the number that the tower
transmitted.  (I am grossly oversimplifying this--forgive me).

So if the tower sent out "100," it would expect to receive a response of
"200," or it knew that the phone was not the one that it was supposed to be.
The tower could change the algorithms in phones periodically, so thieves
could not find out what the algorithm was.

That was the end of cloning.

As far as I know, this authentication scheme continues to be used today.  By
the time that digital handsets came out, all phones were equipped for it.
The process is instant, and is completely transparent to the user.

What I find ironic is the fact that long distance prices have dropped to
where there are often free in the US--and the very thing that carriers were
trying to eliminate has become almost a non-issue.

Go figure . . .

Cheers