Read this link for further explanation/discussion. Short answer...I wouldn't worry too much about the legality of it. It seems to be something of a gray area. The chances of facing any kind of prosecution/legal action for unlocking your phone in the US seem to be somewhere between slim and none. If anyone can point me to a case specifically detailing legal action regarding unlocking a cell phone I'd love to read it. I'll grant you that DMCA suits have been brought...but again, show me something related specifically to cells.

Here is another link.

I think the main thing to consider is the reason that phones are locked. A nice new RAZR from Cingular is going to cost you (depending on the current deal) about $100 with a 2-year service commitment. The cost of the phone is being subsidized by Cingular...it doesn't really cost $100. If you bought it straight from Motorola already "unlocked" (if you could) it would cost you ~$400. Cingular is picking up the difference because they plan on making it up on your service contract over the 2 years. The "lock" is supposed to ensure that you can't use the phone with another provider...the worry being that you'd get an expensive phone for next to nothing, then default on the contract and take your nice new phone to another provider with a cheaper service plan.

I'm a gadget freak, and have (in the last 2 years alone) owned 6 SIM card-based phones that started out locked. Some of them I've unlocked myself (Nokias). The cell companies have provided me with others. Without fail when I've called the company and told them I needed it unlocked for an overseas trip they've given me the code. Even when I'd only been a subscriber for 2 weeks in one case.

Unlock it...but keep paying your bill. I seriously doubt you'll have any problems with John Law.