AT&T crows of unlocking policy; new legislation would protect unlocking

AT&T Mobility (NYSE:T) said it supports unlocking customers' devices if they have met the terms of their service contract and it has the unlock code for a device. The clarification from the nation's No. 2 carrier came as senators introduced legislation to protect unlocking.

The hubbub over unlocking intensified this week after the Obama administration said it supports consumers who want to unlock their mobile phones without fear of breaking the law. The administration urged legislative fixes to remedy a recent government ruling on the topic that removed protections for people who do unlock their phones. The White House's statement was prompted by a petition on the issue that received more than 114,00 signatures. The FCC is also looking into the issue.

The Library of Congress kick started the issue by ruling that there is no copyright exemption for unlocking cellphones, making unauthorized unlocking potentially illegal.

"While we think the Librarian's careful decision was reasonable, the fact is that it has very little impact on AT&T customers," Joan Marsh, AT&T's vice president of federal regulatory affairs, wrote in the blog post. "As we make clear on our website, if we have the unlock code or can reasonably get it from the manufacturer, AT&T currently will unlock a device for any customer whose account has been active for at least sixty days; whose account is in good standing and has no unpaid balance; and who has fulfilled his or her service agreement commitment.  If the conditions are met we will unlock up to five devices per account per year. We will not unlock devices that have been reported lost or stolen."

Marsh also wrote that AT&T has developed a website that allows Apple (NASDAQ:AAPL) iPhone customers to submit their unlock requests online. Unlocking is more common among GSM mobile users, meaning it primarily affects AT&T and T-Mobile USA in the United States. For example, T-Mobile, which does not currently offer the iPhone directly, said recently that around 100,000 iPhone customers every month are making the switch to T-Mobile under the carrier's BYOD plans, bringing the total number of iPhone users currently on the T-Mobile network to more than 2 million. Most of the customers who have brought their iPhones to T-Mobile likely came from AT&T and had their iPhones unlocked.

Meanwhile, Sens. Amy Klobuchar (D-Minn.), Mike Lee (R-Utah) and Richard Blumenthal (D-Conn.) introduced a bill that would instruct the FCC to order carriers to allow their subscribers to unlock their phones and switch to other operators after they have completed their contracts, according to The Hill. Rep. Anna Eshoo (D-Calif.) plans to introduce companion legislation in the House. Additionally, Sen. Ron Wyden (D-Ore.) introduced similar legislation but his bill would not give the FCC authority over the issue.

The CTIA has pushed for the new rules, in part because it protects wireless carriers that pay to subsidize handsets in exchange for customers agreeing to two-year contracts. "According to the Librarian of Congress, who agreed with CTIA, the exemption for unlocking was not necessary because 'the largest nationwide carriers have liberal, publicly available unlocking policies,' and because unlocked phones are 'freely available from third party providers--many at low prices,'" CTIA wrote in a blog post in late January.

For more:
- see this AT&T blog post
- see this The Hill article
- see this PC Magazine article
- see this Engadget article

Related Articles:
White House throws support behind unlocking phones
FCC's Genachowski: We'll investigate ruling on unlocked phones
Petition against unlocked phones ruling will force White House response
T-Mobile, Ting respond to rules requiring carrier approval to unlock phones
AT&T, T-Mobile activate database to combat smartphone theft
Apple starts selling unlocked GSM iPhone 5

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