Carriers get smartphone unlocking outlawed (and show why the subsidy must die)

The unlocked smartphone is about to become an endangered species in the U.S.

Starting Sunday, it will be illegal to jailbreak your phone without the permission of your carrier. While this doesn’t extend to phones like Verizon’s iPhone 5 — which ships unlocked — it does show how laws like the Digital Millennium Copyright Act (DCMA) can be stretched far beyond their original scope.

Every three years the Library of Congress, working with the U.S. Copyright Office, hands out exemptions to the DCMA, which controls how copyright applies to digital content. The latest round of exemptions came last October, when the Library of Congress decided that sanctioned unlocking methods were strong and extensive enough that it didn’t make much sense to allow for unsanctioned methods.

“The record clearly demonstrates that there is a wide range of alternatives from which consumers may choose in order to obtain an unlocked wireless phone,” the Library of Congress wrote in its decision.

As a result, unlocking your new smartphone is now a big no-no unless you have the permission of the carrier that you bought it from. Say hello to the dark side of the smartphone subsidy.

For carriers, the measure is a major win because it makes it that much harder for consumers to take their devices (and business) elsewhere. As for consumers … well, it should be pretty obvious why the move is bad for them.

Tinker-happy companies like iFixit aren’t crazy about the whole deal. “The Copyright Office’s decision to outlaw this right of ownership hurts users and further empowers carriers to trap consumers,” iFixit wrote on its blog today.

While all of that’s true, the measure is also proof of something that’s become increasingly obvious to me in recent months: The smartphone subsidization model is simply a bad deal for consumers. Not only does it lock people into lengthy contracts, but it also results in a grossly asymmetrical balance of power. Consumers just don’t win, even if they are playing a bit less for their smartphones.

Perhaps the silver lining here is that we’re finally realizing that.