Unlocking ruling rings in more cellular chaos

Last month the U.S. Copyright Office put into effect a ruling that allows cell phone users to unlock their phones. Effectively, this ruling will allow -- if not easily enable -- a user to take any phone from one network to another (compatible) network, even if the original carrier put software locks in place to prevent this.

The ruling makes consumer advocates and many users happy. No one likes to spend money on a device (even a highly subsidized one, such as a mobile phone) and then be limited in its use. So from this perspective, the ruling is both welcomed and a bit surprising, as the vast majority of Digital Millennium Copyright Act rulings have been biased against the consumer.

From an IT perspective -- although it's a bit early to know exactly how many parties will react -- the ruling may well turn out to be a mixed blessing, at least for those who don't prepare for it.

I'm sure many IT managers, like individual consumers, will welcome the ability to take fuller advantage of intercarrier competition and number portability, and will use this ruling to leverage existing devices on optimized rate plans across different carriers. Given the cost of business-class smart phone devices, the $20 or $30 required to unlock a phone is a minor expense. And purchasing new phones unlocked out of the box might cost a bit more upfront but may provide an enterprise with an opportunity to standardize on a single handset while still offering choice of carriers based on employee geography and use.

But there's a "but" here, because this ruling could herald some potential "gotchas" that bear some consideration and planning.

First and foremost will be the possible impact on carriers and their pricing models for handsets. Handset pricing to the user is heavily subsidized. Yes, contracts are used to lock customers into the service, but the devices themselves are also tied to services and carriers by their software locks.

When these go away, carriers probably will have to take one of two approaches: make their contracts even more ironclad and contractually lock in customers for long terms, or abandon the subsidies and charge customers something closer to their own costs for handsets. Neither of these possibilities is going to be what the enterprise IT or telecom manager wants. Unlocking a phone may also void its warranty, making support issues fall to the customer and not the carrier.

Another possible impact will be on security. Many carriers lock out not only the ability to move a phone to another carrier but also specific functionalities and features inherent to the phone, such as disabling certain functionalities and cameras.

Carriers do this for their own revenue-related reasons -- for example, disabling Bluetooth to force you to pay for MMS photo transfers instead of just beaming pictures to a PC -- and this can really tick off consumers (witness the class-action suit against Verizon Wireless for Bluetooth feature disablement). But these feature disablements may provide the user with a degree of device security on the cheap. Using the earlier example, disabling Bluetooth file transfers may keep employees from syncing corporate data with their home PCs.

What may be worrying (and potentially more liberating) is the possibility that unlocked phones will be more open not only to new networks but also new applications. IT managers may find that unlocked phones are more likely to be outfitted with potentially unauthorized applications, potentially exposing corporate data.

But the most worrisome issue from an IT perspective is that so many users view their corporate cell phones as their own devices that they can do with as they will. There will be all sorts of new sites flaunting the benefits of opening your phone and loading more things onto it. This is another break in the levee that was already causing IT managers grief. You need to get in front of this issue, track it and understand its impact on your firm. Otherwise, you're going to find out about it in ways you did not think possible.

Copyright © 2006 IDG Communications, Inc.

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