Copyright Law
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Apple maintains that it is illegal for iPod touch owners to modify the device's firmware, as this software is protected by the 1998 Digital Millennium Copyright Act (DMCA). Modification called "jailbreaking" allows users to install software from portals and vendors outside of the iTunes App Store that has not been submitted to Apple for approval. While the DMCA protects the distribution of altered iPod touch firmware, there is a dispute as to whether the law can prevent circumvention of jailbreaking security protocols on the device itself.
Legal Ruling
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In July 2010, the US Copyright Office officially declared that jailbreaking an iPod touch was legal. It concluded that copyright laws are in place to protect intellectual property, but not to enforce business restrictions. While the ruling does not obligate Apple, or any other manufacturer, to allow or facilitate a jailbreak process, it deemed it lawful for users to circumvent jailbreaking restrictions within the device.
Security and Stability
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Apple maintains that jailbreaking is harmful to the iPod touch, as hacking the firmware creates security and stability issues. Proponents of jailbreaking, such as the Cydia community, refute this claim, and point out that security software such as mobile firewalls and on-device anti-virus software is only available through the use of jailbroken applications. Certain security measures are prudent after jailbreaking, however, such as changing the default password for the iPod touch's firmware to prevent remote access. It should also be noted that while it is legal, jailbreaking voids any warranty on the device.
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