Unlocking Your Phone Is No Longer Legal

Recently the Copyright Office issued its triennial list of exemptions retiring the exemption for cellphone unlocking, done mainly in order to switch network carriers. The exemption was necessary to legalize the circumventing electronic locks placed on phones to control which wireless network the devices can connect to. This activity is regulated by the Digital Millennium Copyright Act (DMCA), which prohibits “circumvention of technological measures employed by or on behalf of copyright owners to protect their works.”

The Copyright Office had included the cellphone unlocking technology in its triennial list of exemptions twice – in 2006 and in 2010. The exemption defines the circumventing technology as “computer programs in the form of firmware that enable wireless telephone handsets to connect to a wireless telephone communication network, when circumvention is accomplished for the sole purpose of lawfully connecting to a wireless telephone communication network.”

The Copyright Office’s reasoning behind adopting this exemption was that the phone locking technologies “do not appear to actually be deployed in order to protect the interests of the copyright owner or the value or integrity of the copyrighted work; rather, they are used by wireless carriers to limit the ability of subscribers to switch to other carriers, a business decision that has nothing whatsoever to do with the interests protected by copyright.” In other words, the DMCA would have an undesirable effect if applied without the exemption because it would punish behavior which does not harm the owners’ copyright interests, but rather, their business interests, which is beyond the scope of the DMCA.

Prepaid cellphone companies have been in the front trenches of the battle against this exemption and have been litigating against it ever since it was put in place. Their main argument was that their business model of providing sharply discounted cellphones in exchange for locking down customers to a particular wireless network was being harmed by consumers who do not remain subscribers for long enough to justify the discount and by the emergence of an industry centered around exporting unlocked cellphones.

In its last DMCA exemption installment, the Copyright Office took under consideration what is still mainly a business harm resulting from cellphone unlocking and weighed it against the availability of unlocked phones and the changing market place. In the end, the harm suffered by the prepaid phone industry carried the day and the exemption was retired. The Copyright Office’s explanation of this decision is that “with respect to new wireless handsets, there are ample alternatives to circumvention. That is, the marketplace has evolved such that there is now a wide array of unlocked phone options available to consumers.”

Cellphone owners who purchased their phones prior to January 20, 2013 are still protected by the exemption, but unlocking of cellphones purchased after that could be prosecuted under the DMCA.