Wednesday, December 9, 2015

DMCA exemptions for “unlocking” and “jailbreaking” wireless devices

Originally published by Jeff Pettit.

As we discussed in two previous posts, the U.S. Copyright Office just published its most recent set of exemptions to the Digital Millennium Copyright Act (“DMCA”). In Part I of our analysis we discussed the DMCA’s statutory privacy exception. Part II addressed exemptions related to medical devices. Today, in Part III, we cover the exemption which allows consumers to avoid copyright infringement for “unlocking” and/or “jailbreaking” their used smartphones.

Every three years, the Copyright Office must review all DMCA exemptions and make a recommendation to the Library of Congress for any revisions. Thus, proponents of an exemption must petition for renewal during each cycle and demonstrate that the exemption continues to meet the Copyright Office’s standards. The Copyright Office first permitted users to jailbreak smartphones in 2012, in the last (fifth) round of exemptions. 77 Fed. Reg. 65260. Those exemptions were expanded further this year, and now include tablets, wearables (e.g., smart watches and fitness devices), and wireless hotspots as well.

The roots of “unlocking” and “jailbreaking”

“Unlocking” is a process by which a user alters the internal software of a mobile wireless device that is “locked” to one wireless carrier to allow that device to connect to the network of a different wireless carrier. Although some wireless companies are beginning to move away from this business model, US carriers often subsidize the cost of smartphones. In exchange for the subsidy, the carrier requires a consumer to use that carrier’s service for an extended period of time. This contract period allows the carrier to recoup the subsidy it offered upfront through the consumer’s payment of wireless service fees.

“Jailbreaking” (for iOS devices) or “Rooting” (for Android) is somewhat similar. Instead of changing carriers, jailbreaking/rooting allows a user to modify the internal operating system of the device itself in order to customize that device beyond what the manufacturer permits. For example, a user may choose to jailbreak/root her phone in order to download and install an application that was not approved for inclusion in the relevant database of applications from the manufacturer. The jailbreaking/rooting process gives a user access to the heart or “root” of a device’s operating system, bypassing whatever security measures were first put in place by the device manufacturer or third-parties.

Unlocking the exemptions

The exemption adopted to allow unlocking covers the following used devices: cellphones, all-purpose tablet computers (i.e., iPads are covered, e-readers are not), mobile hotspots, and wearable wireless devices (e.g., smartwatches and fitness devices). To qualify as “used,” the device must have been “lawfully acquired” and previously activated for use with a wireless carrier. This requirement comes from a concern over illegitimate trafficking practices whereby wireless devices are bought in mass quantities domestically at a carrier-subsidized price, unlocked before being activated, and then sold abroad at a substantial profit, leaving the carrier to absorb the loss.

The exemption adopted to allow jailbreaking is more limited in scope, covering only smartphones and “portable all-purpose mobile computing devices,” and must be accomplished solely for the purpose of either “enabling interoperability” of lawfully obtained software applications or removing software from the smartphone or device. To qualify as a “portable all-purpose mobile computing device,” the device must be (i) capable of running a variety of programs (i.e., no e-readers), (ii) equipped with a mobile operating system (e.g., iOS, Android, or Windows Phone), and (iii) designed to be carried or worn by an individual. These limitations were intended to address concerns that the exemption would otherwise swallow all computing devices such as desktops and laptops. The definition also prevents the exemption from reaching wireless devices installed in automobiles.

Proceed with caution

Much of the conversation around granting these DMCA exemptions centers on consumer protection. By allowing the consumer to unlock her device herself, rather than seeking permission from the carrier, the consumer can seek out a wireless carrier that best meets her needs. In fact, the unlocking exemption was in part a response to a Congressional mandate delivered in 2014 through the Unlocking Consumer Choice and Wireless Competition Act.

The DMCA exemptions do not function as a blank check, however. The DMCA exemptions will only protect consumers from copyright infringement claims. At the time of purchase, if the consumer received any kind of discount pricing, the consumer likely agreed to an exclusive service contract for some period of time. If a consumer unlocks her phone in order to take her business to another wireless carrier, there is still the potential for a breach of contract claim, and the consumer may be responsible for an early termination fee. Similarly, a consumer who jailbreaks/roots his device system may violate the manufacturer’s terms of use, which could relieve the manufacturer of any duty to repair or support the device.

Commentary

Finally, employers should also give careful consideration to these exemptions. Bring-your-own-device (BYOD) plans are rising in popularity. Jailbroken devices are, in a sense, compromised, as the manufacturer’s standard operating system has been modified. Some argue that the jailbreaking process can make the jailbroken device more susceptible to security threats. The interoperability concept praised by the Copyright Office means that the end user now bears the risk of installing unauthorized software, as there is no longer a curator, such as the Apple App Store, to verify the developer’s code. Employers should exercise caution in allowing these jailbroken devices into their secured, enterprise environments.

Sources

Digital Millennium Copyright Act of 1998; 77 Fed. Reg. 65260; Yarow, J. “Here’s the Truth About The iPhone And Carrier Subsidies” Business Insider (Online, Apr. 22, 2014); Wiggers, K. “iPhone 6s and 6s Plus Pricing Compared (New T-Mobile Prices Added),” Digital Trends (Online, Oct. 13, 2015); Unlocking Consumer Choice and Wireless Competition Act; Evans, D. “What is BYOD and why is it important?” Techradar (Online, Oct. 7, 2015); Cox, J. “Is iOS jailbreaking an enterprise security threat?” Network World (Online, Dec. 17, 2010)

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