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The exemption would strip Apple of its ability to charge groups with DMCA violations for circumventing the iPhone's security by modifying Apple's internal iPhone software, as long as they did it under the cover of "enabling interoperability," according to the exemption wording proposed by the EFF.
The jailbreak arguments
Users can already bypass Apple's security system by jailbreaking their iPhones using freely available software. This allows the users to run software that Apple does not allow in its App Store. It also allows users to bootleg pirated iPhone software, strips the iPhone of any functional protection from malware, and complicates Apple's ability to release software updates, as the modified firmware on jailbroken phones can result in failed software updates that render the phone unreliable or even unusable until it is restored back to factory default settings.
Speaking for the EFF, Fred von Lohmann has called Apple's argument against the exemption "FUD," "corporate paternalism," and "absurdity." Apple's fillings say the EFF's new exemption request is unnecessary, as the DMCA already has provisions that allow circumvention to enable interoperability. It also claims the EFF is merely trying to use the courts to attack its unique business model, and that the EFF does not present any evidence to back up its claims that legitimizing jailbreaking would result in increased innovation.
Few software companies offer iPhone titles that require jailbreaking, in part because of the grey area under the shadow of threat of a DMCA violation charge from Apple, and in part because of the lack of any profit motive behind distributing software outside of the App Store, where Apple's DRM creates a viable market for mobile software. For developers who can't sell their titles in the App Store, it's an entirely different story however.
Mozilla wants freedom, but won't go on the iPhone
Mozilla insists that Apple would probably not allow it to offer a mobile version of Firefox for the iPhone, based on its reading of the iPhone SDK, which forbids the installation of alternative runtimes. It has neither submitted Firefox nor has it been officially denied a listing by Apple.
A Computerworld report filed by Gregg Keizer quoted Mozilla's CEO, John Lilly, as saying, "The [iPhone] SDK is very clear, that Flash and Firefox and other runtimes are not welcome on the iPhone." However, the report also noted that Lilly "said he doubts Mozilla would venture into the iPhone even if the Copyright Office grants the DMCA exemption over jailbreaking."
Mozilla's mobile version of Firefox, called Fennec, aims to compete against mobile browsers based on Web Kit, including Apple's Mobile Safari and web browsers developed by Nokia, Google for Android, Palm for its upcoming Pre, and RIM for the BlackBerry Storm.
Apple claims in its filing with the Copyright Office that alternative apps which compete with Apple's own software are allowed as long as they meet the other requirements of the SDK. It even specifically cites web browsers; the App Store reveals a handful of alternative web browsers that are already available for download. Most appear to be alternative interfaces to Safari which use the WebKit rendering engine, but at least one appears to use its own.
Skype's missed connection
Skype, which is owned by eBay, a prominent early adopter in iPhone software development, also joined in to endorse the EFF's exemption request, stating "copyright law should not interfere with a user using his or her phone to run Skype and enjoy the benefits of low- or no-cost long-distance and international calling."
However, Apple does not prevent VoIP applications on the iPhone, as long as they use WiFi. The App Store lists a variety of VoIP apps, but Skype currently does not offer an iPhone version of its software.
If allowed, the EFF's exemption might make it easier for companies that want to offer an alternative to the App Store, including the jailbreak software download tool Cydia, which also filed a comment supporting the EFF's proposal.
The DMCA exemption would not stop Apple from filing a copyright infringement case against groups who modify and distribute its software however. The DMCA only relates to the circumvention of security measures that control access to copyright material. Bypassing security doesn't remove copyright. It also doesn't invalidate Apple's software license or SDK, both of which forbid modifying Apple's internal software. A DMCA exemption would only make it far more difficult for Apple to pursue known pirates.
Apple hasn't yet filed or even threatened to file DMCA complaints against any groups or individuals involved in jailbreaking. Instead, the company has focused on making the App Store attractive enough to render jailbreaking superfluous and irrelevant to most users. Since the release of the iPhone 2.0 SDK, interest in jailbreaking has waned considerably.
The company still opposes the EFF's efforts to legitimize jailbreaking, as it would tear down a barrier to copyright infringement, encourage users to dismantle the malware security measures of the iPhone, expose the company to additional support costs from jailbreakers complaining about having "bricked" their iPhones, and erode the commercial success of the App Store, which was built upon the premise that DRM would allow developers to offer apps at low prices in exchange for a high volume, low piracy marketplace.