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The "unicode-escape" and "utf-7" cases affect the more widely-used TextIOWrapper interface:
>>> TextIOWrapper(BytesIO(br"\u2013" * 2000), "unicode-escape").read(1)
Traceback (most recent call last):
 File "<stdin>", line 1, in <module>
 File "/usr/lib/python3.4/encodings/unicode_escape.py", line 26, in decode
 return codecs.unicode_escape_decode(input, self.errors)[0]
UnicodeDecodeError: 'unicodeescape' codec can't decode bytes in position 8190-8191: truncated \uXXXX escape
>>> w = TextIOWrapper(BytesIO(), "utf-7")
>>> w.writelines("\xA9\xA9") # Write one character at a time
>>> w.detach().getvalue()
b'+AKk-+AKk-'
>>> r = TextIOWrapper(BytesIO(b"+" + b"AAAAAAAA" * 100000 + b"-"), "utf-7")
>>> r.read(1) # Short delay as all 800 kB are decoded to read one character
'\x00'
>>> r.buffer.tell()
800002
For UTF-7 decoding to work optimally I think the amount of data buffering necessary would be limited to only a few bytes.