For those who are unfamiliar with the iPhone ecosystem, jailbreaking is iPhone user parlance for modifying the smartphone’s firmware so that it operates with applications (or “apps”) which are not sold through the Apple iTunes App Store. Jailbreaking opens up the ecosystem by enabling iPhone owners to run any apps they wish. Apple, citing reputational and user experience concerns, such as avoiding security breaches and malfunctions, as well as the need to protect app sellers on the App Store from unauthorized distribution of their works, has opposed jailbreaking and lobbied vigorously to maintain a closed ecosystem.

Of course, Apple has a vested interest in keeping the App Store the exclusive source of iPhone apps, as it frequently takes a cut of sales. Furthermore, according to the Electronic Frontier Foundation (EFF), which led the battle to legalize jailbreaking, Apple is somewhat puritanical about what apps may be featured on the App Store. In 2009, for example, Apple initially barred a Nine Inch Nails-themed app from the band’s front man Trent Reznor, as well as “Me So Holy,” an irreverent app that pastes a snapshot of the user’s face over the faces of hallowed religious figures.

The copyright issues involved in the rulemaking, while complex, are worth considering, since they raise cutting-edge issue of digital fair use that will become ever more germane as smartphones (and iPads) become our can’t-live-without, all-purpose personal computing, communication and multimedia devices.

Thou Shalt Not Circumvent, Except….

The so-called “anti-circumvention” provision of the Digital Millennium Copyright Act (DMCA), 17 U.S.C. §1201(a)(1), prohibits the circumvention of technological measures (also known as digital rights management or DRM) that “effectively control[] access” to copyrighted works. In this case, jailbreaking often requires the bypassing of software locks controlling access to the copyrighted iPhone firmware, the bootloader and operating system. Therefore, until now jailbreakers ran the risk of being sued for unlawful circumvention.

However, under the DMCA, the Library of Congress and the Copyright Office may hold rulemakings to create three-year exemptions permitting the circumvention of technological measures controlling access to certain classes of copyrighted works if users are likely to be adversely affected in their ability to make non-infringing uses of those works due to the circumvention prohibition. EFF sought such an exemption, as well as an exemption for DVD “ripping” and a renewal of the 2006 exemption allowing smartphone users to unlock their devices to work with a variety of wireless networks (Apple strikes again).

EFF ended up winning all three exemptions, with some limitations. While it made a number of arguments in favor of the right to jailbreak, the one that clearly resonated the most with the Register of Copyrights was that the modification of the firmware code (technically, the creation of a derivative work, one of the exclusive rights reserved to the copyright holder) to permit interoperability with unapproved apps is a fair use and, therefore, non-infringing.

Fair Use and the Quest for Interoperability

In evaluating the statutory factors of fair use analysis to reach this conclusion, the Register of Copyrights emphasized that the firmware modification is a private and non-commercial use (specifically, use on the very wireless handset owned by the user and for exactly the purpose the code was created, to operate applications) that does not injure Apple’s copyright interests as the owner of the code (though it does impinge on Apple’s interests as “a manufacturer and distributor of a device”). The ruling also noted that the DMCA embodies a statutory policy favoring uses that make software programs interoperable.

Looking at the nature of the work claimed to infringed, the Register of Copyrights observed that the firmware (basically, an operating system) was of a functional (as opposed to a creative) nature and was intended to enable the running of applications. With regard to the “amount and substantiality of the portion used in relation to the copyrighted work as a whole,” while reuse of the most of the original firmware is necessary to run apps, the Register of Copyrights did not give this factor much weight, since the modified code typically represents 50 bytes or less out of approximately 8 million bytes. Most tellingly, with regard to the final fair use factor, the effect of the use on the market for or value of the copyrighted work, jailbreaking does not involve or threaten the commercial exploitation of the firmware, which has no independent economic value apart from the iPhone. Once again Apple fell back on a reputational argument that allowing an exemption would jeopardize the integrity of its ecosystem. But, as the Register of Copyrights noted, this is not a concern that fair use analysis is meant to address.

The cell doors of iPhones and iPads have now been sprung open. However, as a cautionary note, app users should be aware that certain software upgrades provided by Apple will disable jailbroken phones, and failure to install these upgrades may void the user warranty. Still, there’s no question that horizons have widened for app users and developers alike, particularly in the iPad gold rush now currently underway.

Apple’s iPhone includes software locks to prevent applications (or “apps”) other than those sold through Apple’s App Store from running on the iPhone platform. Jailbreaking is the increasingly popular practice of bypassing the locks so that iPhone owners can run non-Apple-approved apps of their choosing. According to the Electronic Frontier Foundation (EFF), which is leading the battle to legalize jailbreaking, Apple has become somewhat puritanical about what apps may be featured on the App Store, barring, for example, a Nine Inch Nails-themed app from the band’s front man Trent Reznor, as well as “Me So Holy,” an irreverent app that pastes a snapshot of the user’s face over the faces of hallowed religious figures.

In any litigation to prevent jailbreaking, Apple is likely to invoke the so-called “anti-circumvention” provision of the DMCA, 17 U.S.C. Section 1201(a)(1). This clauses prohibits the circumvention of technological measures (also known as digital rights management or DRM) that “effectively control[] access” to copyrighted works. Apple’s position would be that the software locks bypassed by the jailbreakers are genuinely designed to protect Apple’s copyrighted code for the iPhone bootloader and operating system from unauthorized modification and copying. While this is far from clear, jailbreakers and their legal advocate the EFF have taken preemptive action to clear the way for the free exchange of iPhone apps outside of Apple’s control.

Under the DMCA, the Library of Congress and the Copyright Office may hold rulemakings to create three-year exemptions from the anti-circumvention provision of the DMCA for certain classes of works if it is determined that users are likely to be adversely affected in their ability to make non-infringing uses of those works due to the prohibition on circumvention of access controls. The EFF has specifically requested the creation of a formal exemption to permit jailbreaking and installation of non-App Store apps on the iPhone platform. The period for public comment ended February 2, and the Copyright Office held hearings on the proposed rulemaking at Stanford Law School on May 1 and in Washington, D.C. on May 6-8. The EFF is essentially arguing that Apple’s software locks are intended to protect a closed business model with respect to the distribution of apps, rather than any legitimate copyright interest. Apple has countered that the software locks protect its copyrighted firmware, with the goals of protecting the iPhone device from harm, excluding malware, protecting Apple’s and its authorized developers’ rights in their apps, and preventing the circulation of pirated apps. A final rule is expected in October 2009.

For more on the EFF’s involvement with the jailbreaking movement and its other digital crusades, check out their website at http://www.eff.org.