Tuesday, February 21, 2012

Optus v NRL: Rightsholders vs Technology...again.

The Optus v NRL decision has thrown rightsholders into their usual frenzy of lobbying to protect their revenues from innovation. In summary the decision allows sports fans to use Optus' TVNow cloud services to stream Free to Air TV that they have recorded (often only time-shifting by a few minutes) through the time-shifting exception in s111(1) and s111(2) of the Copyright Act 1968.

As Rares,J found at [74] (emphasis mine):

"The purpose of the exception in s 111(1) and (2) was to accommodate, to some degree, the law to the realities of modern life. Copying for private and domestic use is so much a commonplace that it is not difficult to infer that a user who made a film, by clicking “record”, was doing so for such a use. Indeed, the rightholders did not suggest how anyone, for example, watching a broadcast or film of a football game or television program, on his or her mobile device or PC would be doing so for some reason other than personal pleasure or interest."

Of course, this finding has bought about the usual howls of protest from rightsholders and the attendant claims that the decision will be the end of sport as we know it - despite decisions in other jurisdictions (cited with favour in Optus v NRL) finding similar services to be non-infringing and their content industry continuing to be profitable.

The sports broadcasters seem to have found a sympathetic ear in the form of the sports minister Senator Mark Arbib. Concerningly Senator Arbib has not only used the  time-worn "think of the children" argument but has also intimated that "there were complex issues to consider before legislating, to ensure any laws were not overtaken by fresh technological developments." (emphasis mine)
Senator Arbib appears to be arguing that any law should ensure that any future technological innovation ought to be stunted by copyright law.

This is the typical position taken by a government that sees copyright as essentially an "industry problem" rather than a problem in the content market. The government's position is evidenced by the "secret" copyright meetings between ISPs and rightsholders to the exclusion of consumer interests and the government's apparent preparedness to acquiesce to international treaties that favour the interests of the US content industry.

Unfortunately the government continues to misunderstand the copyright infringement "problem" as an industry-related problem rather than one caused by an inefficient and over-regulated market which has limited consumers' access to reasonably priced legal content. Consumers are willing to pay for access to legal content and the ABC's iView service is a case-in-point recently capturing over 30% of the sources for downloading/streaming content.

Until the copyright infringement "problem" is re-cast as a problem with the market, rightsholders will continue their cat and mouse game with technological innovation and governments will be tempted to pass knee-jerk legislation to ban it.

As Rares,J pointed out, the law as it stands was passed to "accommodate [...] the law to the realities of modern life". It is these realities that have created the incentive for the market to innovate to enable content to be time and device shifted.

It is dangerous for governments to try to pre-empt market innovation by passing laws to further regulate an already over-regulated and highly inefficient market. In this case, it is particularly dangerous as the change to the law alluded to by Senator Arbib will attempt to curtail consumer expectations that are already widespread in the market - expectations that were previously codified in the s111 exemptions.

The result will be inevitable - just as P2P filesharing has become a statement of civil disobedience amongst certain internet communities - technological innovation to make time and format shifting available to the market will continue to expand regardless of the law. If the content industries refuse to harness the technology and give in to the demands of the market, it is not up to the government to prop them up with regressive regulation.

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