Have you recently taken the New York subway, let’s say, to 23rd, 66th, 86th, or 103rd street?

If you exit at any of these stops you’ll notice some of your favorite entertainment stores vanished. Shut down. Closed for good.

At 23rd and 6th Avenue Barnes&Noble, gone! At Lincoln Center Tower Records‘ flagship store, gone! Over at 86th and 2nd Avenue Circuit City, vanished. And at 102rd and Broadway Blockbuster Video closed its doors, too.

Be it for books, music, movies, or consumer electronics (for anyone 30 years or older), those were among the brands you would likely turn to first - to discover, buy and play your entertainment retail. 

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The trend is unmistakable: the consumer electronics industry has discovered the internet, and activities that have until now always involved a “computer” (such as internet video viewing and mobile internet access) will be increasingly done using a new generation of leaner and meaner dedicated CE devices instead.  This is all well and good: arguably, the modern home computer – more flexible and powerful but also more complicated and (let’s face it) maintenance-intensive than ever – is clearly overkill for such activities.  But as the computer justifiably loses the battle to convince us it’s also a CE device, CE devices are in turn left to grapple with an issue of their own: how much and how best to emulate the computer.

I’m talking software deployment.  You buy a computer, it includes a license for an operating system, and you’re free to go and install whatever software (or malware) you want - in other words, “you buy it, you break it” (in a way, an inversion of the “Pottery Barn rule ” invoked by Colin Powell over the war in Iraq).  But what about a smartphone, or that internet-enabled television you’ll be buying within the next year or two?  While the availability of a rich selection of high quality 3rd party applications is in the best interest of both the device maker and the user, a wide open ”no guard-rails” software deployment policy is in both parties’ worst interest: poorly written applications can harm both the user  as well as the brand, and (news flash) the average home user is a lot less interested in taking on that kind of responsibility than many companies in the computer industry have ever really understood.

For their upcoming line of internet-enabled televisions, Yahoo/Intel have addressed the issue by going with a “widget” rather than “application” model: lightweight software running on a JavaScript engine rather than the OS itself.  Taking another approach, Apple (which in terms of revenue has been a CE company with a side business in computers for a while now) has come up with the iTunes App Store: applications for the iPhone (and likely for the Apple TV in the near future) are installed on the OS itself, but must be first vetted by (and subsequently purchased through) Apple.  This offers the best of both worlds: the developer base for the device is virtually unlimited, but nothing’s going to break, and apps are guaranteed to be secure.  In fact, the “app store” model is currently being imitated by other smartphone makers such as Nokia because it’s been so successful and popular with users.

Well, 98% of us, that is – there’s also a growing geek subculture out there that believes they have the right to do whatever they want to with something they’ve purchased, thank you very much – and they’re dedicated to removing the iPhone’s software restrictions - “jailbreaking”, as it’s called.  Although the practice is in direct violation of the iPhone EULA (software license agreement), it’s gotten so widespread now that a Google search of “jailbreak” and “iPhone” currently yields 3.6 million results -and so the two sides (the Electronic Frontier Foundation and Apple) are set to face off this spring.

Apparently, this dispute is subject to the Digital Millennium Copyright Act , originally meant to fight piracy of copyrighted “works” such as film and music – therefore, it will ultimately fall upon those famously tech-savvy folks at the Library of Congress to decide the issue.  A case can be made for either side – but although I have to admit I’d love the ability to put my iPhone on a network that covers the NYC metro area better than AT&T , I tend to side with Apple on this one – not only because I feel the iPhone EULA puts them on a pretty strong legal footing, but also because I feel that it’s “good and right” to treat software for CE devices differently than software for computers.

One thing is for certain, though – just as developers will continue to write great App Store applications for Apple, others will continue to hack open the system.  What’s unknown is whether Apple go to the length of actually suing users – a tactic that didn’t work very well for the RIAA .