Leahy Bows ‘Narrow’ Legislation to Permit Cellphone Unlocking
Senators of both parties bowed a bill Monday to permit cellphone users to unlock their phones to switch carriers, as was expected (CD March 7 p7) . The Unlocking Consumer Choice and Wireless Competition Act offers a legislative fix that one sponsor called a narrow change that restores an exemption to the Digital Millennium Copyright Act (DMCA) for cellphone firmware unlocking that permits consumers to use their phones with other carriers once their contract terms have expired. A White House official last week advocated for legislative fixes to give consumers greater control over their devices, after the Copyright Office last year removed an exemption for cellphone firmware unlocking granted in previous triennial reviews of the 1998 law.
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Under the DMCA, those who unlock their phones without permission from their carriers may be subject to civil lawsuits, criminal fines or imprisonment. “When consumers finish the terms of their contract, they should be able to keep their phones and make their own decision about which wireless provider to use,” Senate Judiciary Committee Chairman Patrick Leahy, D-Vt., said in a news release Monday. Leahy added that he and his Senate co-sponsors are working closely with the leaders of the House Judiciary Committee to pass “common sense legislation and provide consumers with better choice.” Last week, House Judiciary Committee Chairman Bob Goodlatte, R-Va., and Ranking Member John Conyers, D-Mich., said they back legislation that will permit cellphone users to unlock their devices (CD March 11 p3) . Leahy’s bill was co-sponsored by Judiciary Committee Ranking Member Chuck Grassley, R-Iowa, and committee members Orrin Hatch, R-Utah, Al Franken, D-Minn., and Mike Lee, R-Utah.
Leahy’s bill takes a more narrow approach than other recent legislative attempts to permit cellphone users to unlock their phones. A bill (S-467) by Sen. Ron Wyden, D-Ore., would amend the DMCA, rather than simply restoring the exemption to permit individuals who legally bought cellphones from carriers and wish to connect to a different carrier. Leahy’s bill also differs from the Wireless Consumer Choice Act introduced last week by Senate Antitrust Subcommittee Chairman Amy Klobuchar, D-Minn., Ranking Member Lee of Utah, and member Sen. Richard Blumenthal, D-Conn. That bill would direct the FCC to begin a rulemaking that ensures consumers can circumvent the technological protection measures that prevent their handsets from being used with other networks.
Klobuchar separately asked all five FCC commissioners about their thoughts regarding the cellphone unlocking bills at a Senate Commerce Committee hearing Tuesday (see separate report in this issue). FCC Chairman Julius Genachowski said the Library of Congress’ decision “raises real consumer and competition concerns. We need to address it because right now there are criminal penalties for someone who gets a new phone and unlocks it.” Commissioner Robert McDowell said it’s “important to get past the headlines on this issue.” Despite talk of wireless consumers being hauled away in handcuffs “we also need to understand that we need to protect intellectual property rights and there is a contract law that can convey and give options to consumers."
CTIA had no comment on the legislation. CTIA Vice President-Government Affairs Jot Carpenter previously said that carriers already permit consumers to unlock their phones after their contract terms have been satisfied.
The Senate Commerce Committee’s inquiry into companies that collect online consumer data is not about investigating consumer abuse, fraud or scams, said the committee’s senior counsel, Erik Jones, during a separate panel. The investigation was begun “solely to better understand practices that clearly have important implications for consumers,” said Jones. Last fall, Senate Commerce Chairman Jay Rockefeller, D-W.Va., asked nine data brokers how they collect, use and sell consumer information (http://xrl.us/bntd4h). The letters sent to Acxiom, Experian, Equifax, Transunion, Epsilon, Reed Elsevier (Lexis-Nexis), Datalogix, Rapleaf and Spokeo sought specific information on the consumer data they collect, which entities the companies sold the data to and whether and how the companies provide consumers with the ability to access, opt out, correct or delete their data (CD Oct 11 p13). Jones said the committee is still in the information-gathering phase of the inquiry and at some point will either hold a hearing or issue a report on its findings.
An aide to Rep. Marsha Blackburn, R-Tenn., warned that some lawmakers may have “rushed to judgment” in the debate over data collection practices. “We don’t have all the answers. We want to take a humble approach to these issues,” said Josh Lynch, Blackburn’s technology legislative assistant. Rather than seek broad legislation to govern data collection, it would be more appropriate to identify any consumer harms and then work on narrow legislative solutions, said Lynch. Blackburn believes “privacy and data security are important things but she believes markets work,” he said. “We need to balance the increase in innovation with protecting consumer confidence in the online marketplace.”
DMA Vice President-Government Affairs Rachel Thomas said Congress is giving marketing firms an “opportunity” by asking for more information on their data collection practices. “We need to explain to folks clearer ... what we are doing with information and more importantly what we are not doing with information,” she said. “Our industry has a real incentive to self-regulate effectively. We should put our money where our mouth is.”