A piece of legislation that went into effect on January 26 makes unlocking smartphones without the carrier's permission illegal. Before this law, most wireless carriers would largely ignore individuals unlocking their smartphones and instead sue businesses who would buy phones in bulk, unlock them, and then ship them overseas.
Now, however, it seems that anyone who unlocks their smartphone without permission could be in trouble.
The new law, which is actually an exemption to the Digital Millennium Copyright Act, makes it illegal to "circumvent a technological measure that effectively controls access" to the software in phones that controls which carrier accesses the phone. Tweet
In order to understand the wireless carrier's motives for wanting this law passed, it is important to see it from their perspective. The carriers get money back from phones initially purchased at reduced prices or the consumer gets for free. Then, over the course of the predetermined contract period, the carrier makes money through monthly payment plans.
Unlocked phones circumvent the process. So, carriers are simply trying to ensure they see a reasonable return of investment on each phone manufactured.
For businesses that profit off of buying, unlocking, then selling smartphones, there is now an increased risk of prosecution, according to Mitch Stoltz, a copyright lawyer with the Electronic Frontier Foundation.
Naturally, this brings up the issue of enforcement. It seems likely that wireless carriers will be doing the majority of enforcement, but with the weight of federal law behind them.
Although most wireless carriers are staunchly opposed to other businesses profiting from unlocking their smartphones, James Baldinger, a lawyer for TracFone and many wireless carriers, believes they are actually okay with individuals unlocking their phones.
“The carriers’ position has always been, it’s never been about individual consumers. Individual consumers have never been the target of any of the lawsuits or enforcement proceedings or investigations,” Baldinger said. “They are concerned about traffickers that steal subsidies and in the end increase the cost of wireless for consumers across the United States.”
In fact, many wireless carriers will unlock smartphones for free for individuals. The new law will not outlaw all unlocked smartphones, simply smartphones unlocked without permission.
For most consumers, this new law won't make much of a difference, although many of the carriers claim this new law will reduce expenses by making phones more exclusive. Whether this means lower prices for consumers has yet to be seen.