Cellphone users know that when they sign a contract with a mobile phone company, they're locked into that network for the duration of the deal. What they may not know is that their phone is digitally locked to that network forever. And as of this week, they may no longer have the legal right to unlock it, even after the contract has expired. It's just the latest example of how companies have stretched copyright law to deter competition and innovation, not protect the creators of copyrighted works.
At issue is Section 1201 of the 1998 Digital Millennium Copyright Act, which bars people from circumventing a "technological measure" — e.g., a digital lock — that restricts access to a copyrighted work. Recognizing how sweeping the prohibition was, Congress instructed the Librarian of Congress to grant exemptions every three years for circumventions that enabled non-infringing uses of locked works. The government granted exemptions for mobile phone unlocking in 2006 and 2010 but not last year, ruling that consumers who wanted an unlocked phone could buy a new one or seek permission from their phone company.
The industry's trade association contends that the locks help prevent people from taking heavily subsidized phones to rival networks before they've fulfilled their contracts and (presumably) repaid the subsidies. It also argues that the locks help stop middlemen from buying prepaid phones in bulk, unlocking them and then reselling them overseas. But mobile phone companies already charge hefty early termination fees for users who break their contracts, and they sell prepaid phones with considerably lower subsidies, if any. For example, Verizon gives away the HTC Rhyme smartphone with a two-year contract, but it charges $440 for a Rhyme without one.