App Developers Need to Pay Attention to the DMCA Ruling on Jailbreaking the iPhone
A recent ruling by the Library of Congress on the Digital Millennium Copyright Act (DMCA) resulted
in large changes for cell phone users. The Copyright ruling spoke to several issues on circumvention, but for our discussion today, we shall discuss jailbreaking. Jailbreaking is the process of bypassing cell phone software allowing the user to purchase cell phone applications other than ones required by the cell phone manufacturer (here’s some info on the subject). This ruling has large implications in the app development community and could change the face of apps and cell phones … or according to others - do nothing.
First, when I was discussing this with some friends of mine the first question most had was, “Say what?! Why is the Library of Congress speaking on jailbreaking and who gave them authority? How is jailbreaking a Copyright issue?” So before I go into an analysis of the ruling, a quick rundown of the logistics of this might be in order.
The Library of Congress governs the United States Copyright office (it’s actually a division of the Library of Congress), and as such the Librarian of Congress discusses certain rules from time to time. Okay?! But this still doesn’t answer why this is a Copyright issue. In 1996 there were treaties passed by the World Intellectual Property Organization (WIPO), and the DMCA is the implementation of those treaties. These treaties covered several aspects of IP law, but for this post the relevant area of the treaties implemented into the DMCA dealt with the prohibition of circumvention of technology measures that control access to copyrighted works. In other words, this gave the Copyright office the ability to govern technologies on cell phones that protected copyrighted works, such as applications. As a result, the Librarian of Congress can determine if things such as jailbreaking of phones should be legal or not.
The Librarian of Congress, stated jailbreaking a cell phone was an exception to the general rule of prohibiting people from circumventing certain Copyright protection technologies. Namely, you can jailbreak the iPhone and buy “non-App Store” apps for it. The ruling states:
“Persons who circumvent access controls in order to engage in noninfringing uses of works in these six classes will not be subject to the statutory prohibition against circumvention.
…
(2) Computer programs that enable wireless telephone handsets to execute software applications, where circumvention is accomplished for the sole purpose of enabling interoperability of such applications, when they have been lawfully obtained, with computer programs on the telephone handset.”
Therefore, you can bypass certain iPhone access controls if you are going to legally purchase a non-Apple application for your iPhone.
As you can imagine, Apple doesn’t want this to happen for multiple reasons, and they are doing much to ensure the ruling has no effect on the app market. First, Apple states that if a user jailbreaks the iPhone they will breach their end-user license agreement (EULA). This breach would relieve Apple from its obligation to provide a warranty, repairs, and anything stated in the agreement. Additionally, Apple will continue to develop updates of its software attempting to outsmart the jailbreak engineers. There will be a continuous back and forth of Apple updates and the soon to follow jailbreaking updates. As a result, it might make the process too difficult for the end user keeping them from jailbreaking the phone. But currently that doesn’t seem to be the case. A developer going by the name Comex has been flooded with so much interest in the new Jailbreakme 2.0 software, his site is crashing from too much traffic. I have spoken with some app developers that believe ultimately the consumer will not want to risk losing the warranty, so most things won’t change. However, what occurs when the warranty runs out?
It’s no secret that Apple has a significant market share in the cell phone and application market. The Android markets have been gaining ground, but Apple still maintains a solid position in the market. Prior to this ruling, the iPhone, iTouch, and iPad were all limited to apps from the iTunes App Store. The popularity of these products fuels application development to be more Apple based. Currently, if you are developer, you are going to develop for Apple first and then the Android or other platforms second (if at all). Now that the powers that be say no violation occurs when jailbreaking your iPhone, other application sites will undoubtedly begin to arise. Getjar, an application site already in existence, is about to hit 1 billion downloads. However, iTunes has almost three times as many applications and Apple has stated that they have already surpassed the 5 billion downloaded apps milestone producing over a billion dollars for app developers (leaving Apple with $300 million). Creating a market others will want to cut into. This ruling will no doubt assist in the loss of significant application market share.
Apple makes its money off the iPhone, but how much will the new app markets affect the purchasing of the iPhone? I recently wrote about Apple’s firm position in governing its operating systems and the type of code and applications that would be submitted. Apple believes that flash is a poor system and that it frustrates the Apple OS, so flash products cannot be utilized in app development for Apple. However, flash is not the only restriction with Apple (percentage of sales, procedure of approval, etc.). If other markets begin to lure other developers away from the Apple market higher quality applications will be developed and be sold at other app stores
So what will be the repercussions of new application sites? I assume with the creation of several application sites new license agreements will arise. The freedom to negotiate price, term, programming platforms, etc. will affect how licensing is accomplished in this arena. Although many other outcomes will arise from this ruling, one issue developers will face is how they go about licensing their applications. There won’t be the standard app development agreement as the only option anymore. Competition should likely create flexibility in these otherwise strict agreements. Therefore in developing apps, the creators should begin to realize the popularity of the application could be beneficial for the new app store itself and provide options to the now standard boilerplate agreements.
