Bought an AT&T iPhone 5 brand new in box from a friend, how do I activate it?

Since it's an AT&T phone it shouldnt be a problem. Go to ebay and search "iphone 5 factory unlock service"

There will be lots of listings so find a seller with a good rating.

The price range should be $5-$15 max

They will give you instructions make sure you follow them correctly

If he said that you need to unlock it, then that means that it is only able to be used on ATT. If that is the problem, it should have come with a sim card in the box, and you can pay around 40$ to get it unlocked at a phone store. Don't go to an ATT phone store because they won't unlock it, but you can look up places on the computer, for a store around you, or sometimes there are people that know how to do it and put ads on Craigslist and such. Now, if it did not come with a sim card, that either means that he bought it already factory unlocked, or he took the sim. I'm not completely sure about the sim problem though because I use simple mobile, which still has those types of sims.

The only way to use the phone is to have a sim card, so what you can do is contact ATT and see if they will sell you one even though you aren't a customer. (they sometimes make exceptions) If they won't do that, there is another option. The easiest thing to do (easier than getting a new sim because that can have problems with the number porting) is to switch plans. I know you said that you plan on staying with Straight Talk, but there are other non contract plans that cost about the same. If you chose Simple Mobile for example, they will port your number, give you a new sim, and you can use the phone as long as it's unlocked. (again if it isn't you can have it unlocked which is still cheeper than buying the phone new) I'm not sure how you feel about this, or how much you pay now, but I know that Simple Mobile is 40$ a month for talk text and web, unlimited in my area. I'm not saying you have to go with Simple Mobile, that was just an example.

So basically you need to get your hands on a sim card, whether it be from ATT or a no contact phone company, and get the phone unlocked if it isn't already. Porting your number should be free, and switching company's should only cost you for the minutes, or for the monthly thing, so your looking at that and the unlocking fee if it isn't unlocked already. Honestly, once you do those things, what you ended up paying is a good deal compared to how much the phone actually is when you buy it full price, so you did not get screwed too much, especially if the man did not know you didn't have a sim card already for it.

Lastly, if you don't want to change to a different no contract plan, then talk to Straight Talk and see what they can do, if you haven't already. If the first guy you talk to says it isn't possible, go to a different store and talk to someone else. Sometimes they really don't know what they're talking about. After you've done these things and you can't use the phone, or don't want to switch, you can sell the phone for the actual price for it being unlocked (around 700$) and buy the Straight Talk version that doesn't require a sim. (My area does this, so it may depend on which area you live in) Good luck, I hope everything works out for you! :)