Are you able to unlock your iPhone? Is it illegal? The Apple store sells unlock iPhones so it must be okay, right?
This iPhone technology issue goes back to 1988 where the ban was created deeming it illegal to circumvent digital protection technology. In layman’s terms, it means you are altering the iPhone’s software without paying any extra, new fees to the new phone provider. If somebody doesn’t make money on you, it must be wrong. My money-hungry philosophy it not so far off. Cell phone providers contend that they won’t be able to make their money back on the actual cell phones if consumers can decide to unlock and choose any provider on a whim.
The cell phone providers argue that they show good faith by allowing consumers to unlock their iPhones, or other phones, after carrying out the first term of their contract. For example, if you finish the 2-year AT&T contract given with a new iPhone, you may unlock your phone and go elsewhere afterwards. Cell phone providers say they’re fine with that, but not happy with premature iPhone unlocks before their 2-year or other initial contract terms.
Unlocking your phone allows you to keep the same actual phone with other wireless carriers. That’s another big advantage for consumers since it’s a hefty bill to buy a new phone if you don’t need to. The White House is trying to allow consumers to take their cell phone to any provide and continue the same initial terms contracted out. That will prevent new wireless plan charges and buying new phones.
I like the idea, but it will greatly harm competition, possibly begging a monopolistic price-fixing approach by all providers. A union-like approach may also be taken up, striking for higher rates. If AT&T, Verizon, Sprint, and others were forced to band together to allow unlocking and carry-over of phone plans, then their overall bottom lines would be drastically reduced. At the worst, the providers may group together and raise overall pricing since they would have to capitalize during the initial contract with a new phone. Brand loyalty would not exist due to the ease of unlocking and transferring to another wireless provider. So, I would fear them banding together and dictating terms for consumers.
If you’re wondering, it is, in fact, illegal to unlock your iPhone if you haven’t finished the initial term of your wireless contract. You could risk, according to the Digital Millennium Copyright Act, up to a $500,000 fine and five years in prison! Wow! Of course, that is reserved for the most heinous offenders who look to profit on unlocking iPhones. But, be careful if you are planning to unlock. Don’t go around boasting about it!
For the meantime, this iPhone issue is locking up, pun intended, in Congress and the White House to decide on whether iPhone unlocking should be altogether legal.