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Unlocking Phone to Change Wireless Carrier Curbed by U.S.

By Todd Shields
January 26, 2013 12:00 AM EST 3 Comments

Starting today, U.S. consumers won’t be allowed to unlock new mobile phones purchased from wireless providers, under a change in U.S. rules backed by carriers led by Verizon Wireless and AT&T Inc. (T)

The Library of Congress’s Copyright Office, as part of a periodic review, said altering software to let one carrier’s phones work on other networks won’t be among activities that are expressly permitted under copyright law. The rule change was announced last October.

CTIA-The Wireless Association, with members including the four largest U.S. mobile carriers -- Verizon, AT&T, Sprint Nextel Corp. (S) and T-Mobile USA Inc. -- had argued that “locking cell phones is an essential part of the wireless industry’s dominant business model” involving handset subsidies and contracts, Librarian of Congress James Billington said in the notice.

Consumers can still choose to buy unlocked phones that will work with multiple carriers, giving them an alternative, Billington said. Partly because of that possibility, unlocking newly purchased phones doesn’t merit an exemption under copyright law, he said. Consumers who bought phones before the change can unlock their handsets, according to the rule change.

The new restriction represents a misuse of copyright law, Sherwin Siy, a vice president with the Washington-based policy group Public Knowledge, said in an interview.

“It wasn’t made to make it harder for people to switch phone companies,” Siy said.

Legal Protection

The change removes legal protection that has allowed consumers to unlock their phones and doesn’t explicitly make the act illegal, Mitch Stoltz, a staff attorney with the Electronic Frontier Foundation, a San Francisco-based advocacy group, said in an interview.

“You will not have this shield in the event you’re sued,” Stoltz said. “It may go to court some time, and then it will be up to a judge.”

CTIA said in a filing with Library of Congress that subsidies “depend on ensuring that the handset will be used, as contemplated, with the carrier’s service.”

Circumventing barriers to unauthorized use “will have significant adverse effects on the wireless industry and on the public,” the Washington-based trade group said in its February 2012 filing.

Amy Storey, a spokeswoman for Washington-based CTIA, didn’t immediately supply a comment.

To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net;

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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