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This is very easy if you have a Mac. Just drag your song into Garageband, activate the loop setting, select the part of the song you want to be the ring tone (40 seconds or less), then go to "Share" at the top and click "Send Ringtone to iTunes".
 
Using Itunes,

1) Select the song you want
2) Hit command+I
3) Go to options
4) Determine start and stop time (0.30 time limit).
5) Select okay
6) Go to the advanced list in the menu bar at the top
7) Choose create AAC version
8) Drag the AAC version created to the desktop
9) Double click it to rename it.
10) Change the .m4a into .m4r and confirm.
11) BEFORE YOU DRAG IT BACK TO ITUNES, DELETE THE AAC VERSION FROM ITUNE FIRST THEN DRAG.

Looks kinda long but it is very easy to do. Takes just a few seconds
 
Using Itunes,

1) Select the song you want
2) Hit command+I
3) Go to options
4) Determine start and stop time (0.30 time limit).
5) Select okay
6) Go to the advanced list in the menu bar at the top
7) Choose create AAC version
8) Drag the AAC version created to the desktop
9) Double click it to rename it.
10) Change the .m4a into .m4r and confirm.
11) BEFORE YOU DRAG IT BACK TO ITUNES, DELETE THE AAC VERSION FROM ITUNE FIRST THEN DRAG.

Looks kinda long but it is very easy to do. Takes just a few seconds

Yep, that's the method I use to make iPhone ringtones (or at least to get them to the m4r format, anyway)!
 
There's nothing out there to create custom SMS tones. :(

quite the contrary, look at my guide in my sig it will tell/show you how to make Custom SMS Sounds or even Custom system wide sounds, like lock unlock new mail sending an sms etc...
 
Gotta make sure file size is less than 3MB and/or smaller than 40 secs. Otherwise it won't work.
 
i believe that it is very important to put a 250 Hz high pass filter and at least 3 dB of limiter on anything you wish to use as a ringtone. i have never used garageband but i know it has a pitch correction plugin, so it ought to be able to do those things. if not, audacity can.
 
quite the contrary, look at my guide in my sig it will tell/show you how to make Custom SMS Sounds or even Custom system wide sounds, like lock unlock new mail sending an sms etc...

Not everyone is willing to jailbreak their iPhone just for the custom SMS ringtones, though.
 
Not everyone is willing to jailbreak their iPhone just for the custom SMS ringtones, though.

This is true and unfourtunately for those that don't I don't think they ever will be.

I do have a theory though, if pwnagetool can be used to create custom .ispw's then wouldn't someone be able to create a firmware with the desired SMS sounds? And not have the rest of the jailbreak?(cydia ryp icy)?

Could they not change the entire phone and not hVe those jailbroken apps installed?
 
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