The best way of explaining is to let the EFF speak for itself:
As we have been saying for years now, the Developer Agreement is bad for developers and users alike. Here are a few of the terms that we are worried about:
Ban on Public Statements: Section 10.4 prohibits developers from making any “public statements” about the terms of the Agreement. This is particularly strange, since the Agreement itself is not “Apple Confidential Information” as defined in Section 10.1. So the terms are not confidential, but developers are contractually forbidden from speaking “publicly” about them.
Ban on Reverse Engineering: Section 2.6 prohibits any reverse engineering (including the kinds of reverse engineering for interoperability that courts have recognized as a fair use under copyright law), as well as anything that would “enable others” to reverse engineer, the software development kit (SDK) or iPhone OS.
App Store Only: Section 7.3 makes it clear that any applications developed using Apple’s SDK may only be publicly distributed through the App Store, and that Apple can reject an app for any reason, even if it meets all the formal requirements disclosed by Apple. So if you use the SDK and your app is rejected by Apple, you’re prohibited from distributing it through competing app stores like Cydia.
No Tinkering with Any Apple Products: Section 3.2(e) is the “ban on jailbreaking” provision that appears to prohibit developers from tinkering with any Apple software or technology, not just the iPhone, or “enabling others to do so.”
Apple Owns Your Security: Section 6.1 explains that Apple has to approve any bug fixes or security releases. If Apple does not approve such updates very quickly, this requirement could put many people in jeopardy.
Kill Your App Any Time: Section 8 makes it clear that Apple can “revoke the digital certificate of any of Your Applications at any time.” Steve Jobs once confirmed that Apple can remotely disable apps, even after they have been installed by users. This contract provision would appear to allow that.
These are the conditions, together with some others, that have been worrying lots of programmers and we generally accept them because – well – it won’t happen to us will it. This is exactly like the rabbits eating the farmer’s supplied food because the rabbit in the pot isn’t likely to be them.
As the EFF concludes:
“Developers should demand better terms and customers who love their iPhones should back them.
At EFF, we walk our talk. We will not agree to contract terms that we couldn’t endorse for others, and we certainly will not wrap our app in DRM.”