With the advent of modern smartphones, many users have sought to jailbreak their phones to allow them to use unauthorized code (such as controversial apps or services not officially allowed by hardware or service providers).  Many also have sought unlock the SIM cards on phones, allowing them to be used on networks which the hardware providers do not officially have deals with.

Apple has long contended that unlocking and jailbreaking is illegal under the 1998 Digital Millennium Copyright Act [PDF].  Apple claims that it supports a vast variety of evils including gangs, drug dealing, and terrorism.  Other companies like Microsoft or Palm [now part of HP] have remained mum on the issue.  And yet others -- like Google -- have been mildly supportive/tolerant of unlockers, while stopping short of providing the tools to unlock phones themselves (which might endanger their valuable carrier contracts).

Some expected the U.S. Supreme Court or further legislation by Congress would eventually tackle the issue.  However, a surprising source appears to have, in essence, given unlockers and (phone) jailbreakers the legal green light -- the Library of Congress.

While not typically officially considered a part of the legislative branch, the Library of Congress is rather an independent research organization tasked with supporting Congress in a variety of ways, including legal research and preserving our nation's history.

The Library of Congress added the following passage to the DMCA, as a result of its research:

Computer programs that enable wireless telephone handsets to execute software applications, where circumvention is accomplished for the sole purpose of enabling interoperability of such applications, when they have been lawfully obtained, with computer programs on the telephone handset. 

There are still some sticky legal issues, despite this seemingly liberal addition that opens the door to potentially legalizing unlocking/jailbreaking of smart phones in the U.S.  The DMCA still specifically forbids "technology, product, service, device, component, or part thereof" used in breaking underlying access protections.  That is thought to include unlocking efforts such as the George Hotz/iPhone Dev Team's donation-financed iPhone hacks that allow the phone to jump ship to T-Mobile's GSM network in the U.S.

Also significant, the Library of Congress has amended the use of video excerpts from commercial film -- such as movies or television -- to include "documentary and non-commercial applications" as well as educational ones.  That potentially legalizes video montages, the likes of which oft pop up on YouTube and elsewhere, which the MPAA and others have long contended is illegal.  With the new language Google and others may gain grounds to fight takedown notices.

The Library of Congress's tweaks to the DMCA certainly seem a progressive step forward.  With new legislation like ACTA pending, it may only be a temporary one.  It remains to be seen whether the U.S. will continue to step forward in terms of customer and artistic freedoms, or whether this is merely a brief advance before a subsequent retreat.