Listening to NPR last week, I caught a story about a new iPhone lawsuit. Some enterprising types filed a claim that the exclusve deal between Apple and AT&T - you can only get iPhone service if you subscribe to an AT&T service plan - violates antitrust laws, because it illegally ties a product (the way-cool phone) to a service. In the past, special deals like that were not that uncommon or necessarily unfair; except now there's a DMCA catch - rules emanating from the Section 1201 proceedings concluded by the Librarian of Congress last November.
Turns out the way Apple and AT&T enforce the exclusivity is via a special coded card inserted into the phone. Phone owners are prohibited from bypassing the card's restrictions, which in copyright parlance are "technological measures" designed to "control access to a work" (the computer programs that run the phone. Not surprisingly, there are plenty of techno-fixes to undo the limit, but Apple is playing hardball and deactivating phones that break the lock.
While Apple-AT&T's goal of exclusivity is technologically enforceable, last year, the Librarian of Congress, following orders from Congress to conduct a review of how the anti-circumvention rule in Section 1201 was impacting fair use, concluded that people who own their own cellphones should be able to migrate to any carrier of their choice with their own phone.
Does the Apple-AT&T deal run afoul of this DMCA exception? The stakes are pretty high. With over 1 million people forking out $400-600 to buy the iPhone, and with billions of dollars of cellphone services at stake, could the DMCA be a wrinkle in the double A's plan? The issue has international repercussions because Apple is forming pacts with exclusive carriers around the world. So if you are traveling with an iPhone and want to stay connected through any carrier whose wireless service could accept the iPhone, the key issue is can you? This litigation may provide an answer to that billion dollar question. And as the case gains in notoriety, it will alert other cellphone owners to their right to take a phone they own (perhaps after their initial service contract with a carrier concludes) and if they are dissatisfied with their cellphone provider, to switch. Of course, there may be some cancellation fee hidden in the contract provision that complicates the change, but that, too, could be in play. If it turns out that cellphone owners can be liberated from a poor service provider, they could have the DMCA to thank.