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I know you all are aware of how iPods are jailbreakable, and most of you realize that is true of several other devices. Now under the last lawsuit with Apple. The DMCA recognized that it is legal to jailbreak mobile devices. It is obvious Apple will get at them again and attempt to make it illegal.
When someone jailbreaks an iPod, they either flash or use a custom OS (very identical to the original but more open) on the said device. I have used it and found it very enjoyable. It allows you to bypass restrictions and make said device much more open.
Now the case for it is, obviously, that once the device has been purchased by said owner it now becomes his. He owns it outright and it is in his name even on the tax return. Meaning that you have the right to do what ever you wish to to your device once it is in your hands, so to speak. Apple can make updates to stop it, but other than that can do nothing.
The case more against it would be more piracy related. Of course when people hear jailbreak they think free apps. Now this is the case, but it is not directly related to the jailbreak.
PS: This debate is more open to all console/devices, including PS3.
Yes, because if you purchase something you own the hardware and should be able to jailbreak in order to unlock that hardware to your own software.
Blocking users from services like PSN however under the ToS after jailbreaking is fine, given that PSN as an example is Sony's service, and that I don't own.