Obama administration declares that it’s time to legalize mobile phone unlocking

The Obama administration and the FCC (PDF) today came out in favor of changing new legislation that makes it difficult for consumers to unlock their rightfully owned mobile devices — cellphones, smartphones, and tablets — without risk of fines, jail time, or other criminal penalties. The announcements arrive on the heels of a successful online petition campaign to change a recent Library of Congress ruling that made the unlocking of smartphones purchased after Jan. 26 illegal.

Notably, neither the White House nor the FCC offered any definitive recommendations for rewording the Library of Congress’s ruling. They said that the Obama administration, Congress, the FCC, and the NTIA (National Telecommunications and Information Administration) need to hash that out.

Neither the FCC nor the White House suggested in their respective statements that consumers should have the right to freely unlock their mobile devices under any and all circumstances, either. The general consensus was that consumers who own a phone free and clear — whether they paid full price for it from the get-go or bought it subsidized as part of a contract, then fulfilled that contract — should be able to use that phone on any carrier network.

“[I]f you have paid for your mobile device, and aren’t bound by a service agreement or other obligation, you should be able to use it on another network,” wrote R. David Edelman, senior advisor for Internet, innovation, and privacy. “It’s common sense, crucial for protecting consumer choice, and important for ensuring we continue to have the vibrant, competitive wireless market that delivers innovative products and solid service to meet consumers’ needs.”

Separately, FCC chairman Julius Genachowski issued the following statement:

From a communications policy perspective, this raises serious competition and innovation concerns, and for wireless consumers, it doesn’t pass the common-sense test. The FCC is examining this issue, looking into whether the agency, wireless providers, or others should take action to preserve consumers’ ability to unlock their mobile phones.

The Library of Congress, which has become the scapegoat for the ruling, also weighed in on the issue, effectively explaining that its hands were tied in making its ruling, as it was following processes spelled out by the Digital Millennium Copyright Act. “As designed by Congress, the rulemaking serves a very important function, but it was not intended to be a substitute for deliberations of broader public policy,” read the statement. “We also agree with the administration that the question of locked cell phones has implications for telecommunications policy and that it would benefit from review and resolution in that context.”

InfoWorld’s Galen Gruman outlined the controversy:

Here’s the issue: When you buy a subsidized smartphone (as most Americans do), you buy a device locked to a carrier’s domestic network, even if it has a SIM slot that allows swapping and, thus, running on a different carrier’s network. It makes sense that a carrier that just subsidized the price of that new iPhone 5, BlackBerry Z10, Windows Phone, or Android smartphone to the tune of $200 to $400 wants to make sure you don’t switch to a different network and leave it in the lurch for the subsidy. But the Library of Congress ruling goes about this the wrong way.

The specific question, by Gruman’s reckoning, wasn’t over whether a user who wants to break his or her contract with a carrier should have to pay that carrier to recoup the cost of a subsidized phone. The real issue with the Library of Congress’s rules is that they made it excessively difficult for a user to get a carrier to unlock his or her phone for international roaming:

You have to call and ask them to unlock the phone for such use, which can take several weeks — and let them say no. Some carriers require you to have a contract for several months before you can get your phone unlocked for roaming abroad. These are silly impediments — all phones should be unlocked at the outset for international roaming.

The second problem is a trust issue: Until the LOC’s ruling went into effect last month, U.S. carriers had been accommodating of international unlocks because the LOC said they had to. Critics of the rule, including the original author of the petition, Sina Khanifar, were concerned that the carriers would use the LOC ruling as an opportunity to revert to greedy behavior and make it even more difficult to legally unlock their phones for legitimate international use. (There was a time when carriers charged users $1.50 or more per minute for “roaming fees,” a much more lucrative alternative to letting a user install a $20 SIM for international use.)

According to Edelman, the White House supports a range of approaches to addressing the issues raised by the LOC’s ruling. They include making “narrow legislative fixes in the telecommunications space that make it clear: Neither criminal law nor technological locks should prevent consumers from switching carriers when they are no longer bound by a service agreement or other obligation.” He noted that the NTIA will “formally engage” with the FCC to work on the issue.

Finally, Edelman said the Obama administration “would encourage mobile providers to consider what steps they as businesses can take to ensure that their customers can fully reap the benefits and features they expect when purchasing their devices.”

In a statement, Khanifar greeted the White House statement with optimism:

This is a big victory for consumers, and I’m glad to have played a part in it…. The White House just showed that they really do listen, and that they’re willing to take action. While I think this is wonderful, I think the real culprit here is Section 1201 of the DMCA, the controversial “anti-circumvention provision.”

Khanifar said that he has discussed the idea of amending or removing the provision with the White House and promised news on the campaign tomorrow.

This story, “Obama administration declares that it’s time to legalize cell phone unlocking,” was originally published at InfoWorld.com. Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog. For the latest developments in business technology news, follow InfoWorld.com on Twitter.