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Feb 8, 2012

A simple copyright amendment? Sports chiefs don’t understand

Our copyright law is a wondrous complex beast, and even apparently simple tweaks carry the potential for significant unintended consequences, writes Kimberlee Weatherall, an associate professor in Sydney University's Faculty of Law.


Surprise, surprise, the lobbying has started. The news today is full of the fact that a group of sports chiefs met with senior government ministers to seek a “quick and simple” amendment to the Copyright Act to “fix” the decision in the Optus versus NRL case handed down last week. Ah, yes, the knee-jerk reaction. “Just make this little change and everything will be fixed.”

Don’t take that claim at face value. Our copyright law is a wondrous complex beast, and even apparently simple tweaks carry the potential for significant unintended consequences. Let me explain a little.

Justice Rares ruled on broadly two questions, legally speaking. First, when consumers use a cloud-based service such as Optus TV Now, is it Optus, or the consumer, who is making the copies, or doing the streaming? Justice Rares ruled that it is the consumer who is undertaking those acts. On this, I think Rares J is right: it’s entirely consistent with case law overseas, and with our own copyright precedent. It rightly pegs a cloud provider as a facilitator of others’ acts, not as the actor.

That doesn’t let cloud providers entirely off the legal hook — if their customers engage in mass infringement, we have rules against “authorising” infringement. But it’s important to realise that any copyright amendment that overturned this part of the ruling could have disastrous consequences for any and all cloud-based services. Suddenly every cloud operator would need copyright licences for any copyright material on their servers. If they can get them. Hello barriers to entry.

The second part of the ruling related to the time-shifting exception. Here the judge had to decide whether consumers were acting only for “private and domestic purposes”, and to watch the broadcast “at a more convenient time”.  Justice Rares ruled that what was happening on Optus TV Now did fit this exception, even where, on Apple devices, they could watch the recording on a two-minute delay.

Now I can imagine a few ways the sports chiefs might seek to overturn that interpretation. They could go the whole hog and demand that the exception simply not apply to cloud-based services. That would mean consumers could record TV to watch later — but only on their own digital video recorder in their home. Or they could demand a carve-out for live sports (so no recording the football). Or they could demand that “a more convenient time” mean no earlier than the completion of the original broadcast — getting rid of the streaming on two-minute delay and protecting “live” sports but preserving consumers’ ability to record football.

Some of these possibilities are worse for the football-loving public than others. It would be pretty drastic, for example, to deny people any right to use cloud services (and terrible for innovation and our digital economy). It would be harsh indeed to deny the right to record live sport (and ironic, since recording football was one thing Senators were concerned to protect, when they started thinking about this issue  in 2004). Preventing the streaming on a two-minute delay is less severe.

But any change to the time-shifting exception leaves football fans worse off. Most obviously, any change that will satisfy the sports chiefs and protect the AFL’s exclusive deal with Telstra means that customers of any other mobile phone provider lose out (if they’re AFL or NRL fans, that is). We’re meant to change mobile providers for the NRL season? How does that make sense? And, by the way, how does that serve the NRL which surely wants a bigger audience for its games?

More generally, if the government turns around now and changes the law, we all lose. This is because of the message that an amendment will send to anyone who wants to offer innovative services to consumers in the digital environment. In this case, Optus took a risk, invested in a new service for its customers, entirely within the law. It acted on the basis that the government had given consumers certain rights to time shift in 2006. If the government turns around now, in panicked response to the sports chiefs’ lobbying, and retracts rights it gave so recently, what incentive does anyone else have to take a risk in the future? So much for Australia’s exciting new digital economy.

It seems to me that both the government, and the sports chiefs, might do well to take a breath and look around. The government might do well to read some of the online comments from the public, many of whom are displaying little sympathy for the sporting codes and broadcasters who have failed, in so many cases, to provide live access to big sporting events (anyone remember the Rugby World Cup?). Or they could refer the issue to the ALRC, which is already meant to be looking at copyright exceptions this year.

And the sports chiefs might do well to think a little more creatively: to see the internet not as just another revenue stream to be tapped through exclusive licences, but as an opportunity to engage directly with the fans, and to provide a better and more interactive experience of live sport than Telstra or Optus ever will.


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20 thoughts on “A simple copyright amendment? Sports chiefs don’t understand

  1. Vincent O'Donnell

    I interviewed the then AG Phillip Ruddock about the raft of amendments that including the home recording and time shifting provisions. My recollections is that he saw the two as tightly linked.

    But a simple amendment is possible if the home recording/time shifting provisions are withdrawn and a general fair use provision inserted.

    Then Optus’ TV Now would have to argue that TV Now offered a fair use despite its use occasioning financial loss to the owners or licensees of copyright in the content.

    It would also leave the courts free to read the act for legislative intention in the face of technological innovation, rather relying on the legislature to apply one more patch to the severely mended Copyright Act of 1968.

  2. mattsui

    I really don’t get what all the fuss is about.
    Why are the sporting bodies so upset and how can this possibly affect tv rights?
    Optus isn’t altering the progrommes in any way are they?
    If I use Optus’ cloud to record the footy, I’ll still see ads after every goal – not to mention plastered over every surface of the stadium and superimposed over the pictures.
    As I understand it, Optus’ cloud is just an ethereal vcr. Perhaps Optus stands to make some cash from its service and the establishment wants its cut? Tough tit!
    I think it’s a load of bollocks. AFL et al have wasted a bomb on legal action for no good reason.
    Perhaps Crikey could gives a “clarifier” on this issue.

  3. Meski

    It isn’t broken, so why does it need fixing? This is just the AFL sniveling and whining and not accepting the umpires decision, which they get very narky about when it comes to players and coaches doing it to them.

  4. Maikeru

    In a fight between innovation and the law, I’ll back innovation.

    So, change the law and I can’t use the cloud but only my own DVR?
    Righty-o, I’ll record on my PS3 at home and watch using remote play on my PSP.
    And if there’s isn’t an app that allows the same thing between my iPhone and Apple TV, you can bet it’s on it’s way.

  5. floorer

    Referring to your last para. I’d love to see pay for view live streaming direct from the AFL. I’d pay. Imagine if a membership to your team had the option of watching games live included in the cost for example. Perhaps the benefit of exclusive contracts is once they are concluded they can just sit back and watch the lolly come in,whereas pay for view(for eg) might not be such a reliable stream. I don’t know, I’m just a member and supporter.

  6. Gavin Moodie

    I presume some of the games broadcast by Telstra are viewable live only by subscribers to Foxtel, so if people can see the game with a 2 minute delay thru Optus, Telstra’s Foxtel will lose subscribers.

    I expect the AFL risks losing millions annually in tv rights should Optus’ TV Now continue, so while its legal action and lobbying are surely expensive, I expect it is an expense well worth making.

    This seems just the sort of issue that should be referred to the Australian Government’s current convergence review which is examining ‘the policy and regulatory frameworks that apply to the converged media and communications landscape in Australia’, as the Department of Broadband, Communications and the Digital Economy’s web site says.

  7. mattsui

    How does it work?
    If Optus is recording and rebroadcasting the games, it would surely be in breach.
    If an individual is doing it for themself -or a small private audience – there sahould be no issue.
    Where does the content come from?
    Can I use the cloud service to view material uploaded by anybody?

  8. Gavin Moodie

    @Vincent O’Donnell

    It seems your contribution was held up in moderation. Sigh!

    In her piece ‘AFL, NRL appeal likely, but Optus TV ruling the right call’ published by Crikey on 2 February Weatherall suggested that copyright owners would not have been in this difficulty had they accepted the proposal for a fair use provision in 2006.

  9. Rourke

    It’s easy enough for individuals to narrowcast their own TV output to their personal mobile phones – legally – if they can pay for the bandwidth. It’s also better than two minutes behind. Don’t understand why Optus is getting the can from the sporting bodies for this, they are just the first head to pop above the barricade.

  10. Mark from Melbourne

    I also still dont get it.

    If it is just an individual (or many individuals) recording a live telecast and watching it minutes later or hours later – why is there any fuss at all? It’s just a variation of what is currently “allowed” which is recording to a PVR or similar.

    And what is the commercial cost of this practice to AFL or Telstra – none that I can see that they are not already exposed to if it’s a PVR (or series of PVR’s).

    However if Optus is recording it and making it available to it’s users then thats a whole other ball of wax and I would think is clearly in breach of copyright laws.

    What’s the real story Crikey????

  11. Gavin Moodie

    The problem for the AFL is that viewers are watching their game on Optus which doesn’t pay it broadcast rights instead of on Telstra which does pay it broadcast rights, losing Telstra’s Foxtel subscribers. Since presumably many viewers would be attracted to Optus’ service Telstra wont bid so much for ‘exclusive’ broadcast rights next time.

  12. Dwayne

    Let the games begin. The copyright dance has come to town kids, put on your boots and boogie on down to your favourite copyright protected hits (fully licenced, of course).

    There is no issue here. Optus isn’t recording it and then offering it for stream, Optus are letting you record the games yourself as if you can’t already do that with a VCR, TV Tuner / DVD Recorder set-top unit or DVR box anyway. They’re merely letting you stream the video you recorded off of their server. As far as I know, this isn’t a case of Optus recording anything, they’re just offering the storage for your intentions and the means to play it.

    It’s a two-way street. We all know the real issue here is that the AFL are threatened over the fact that if people can watch their games elsewhere like the service Telstra offers, the exclusivity of their deal with Telstra isn’t so exclusive any more which means less money lining the greedy AFL executive pockets.

  13. Liz45

    If we can record other programs on TV, why can’t we do the same with sport, and on all or any facility? TV, Ipad, Smartphone etc? I don’t see why they have a reason to protest. But then, I don’t have the details of the agreements etc. But, didn’t the Judge say the same thing?

    So can we expect the same thing to happen when the Olympic Games are on? I’ve recorded lots of things from the Olympics etc in times past.

    Who owns the airwaves? Who has the right to tell me what I can download and watch later, and what I can only see instantly? Interesting what happens when big bucks are involved?

    Now, this really is an example of a nanny state? I’m prepared to accept that I could be showing my ignorance here. If the reason why there’s money in it, and the advertisers want their products purchased by people watching the game/s, why are they complaining? Won’t it have the same effect regardless of how and when people see it?

  14. Brian Williams

    I posted the following comment on a Crikey article about this subject last week, but it’s apparant that it’s just as relevant here.

    There’a lot of disinformation about this case both within the article itself, the various sports bodies rantings and ravings, and the comments above. Here are the facts in a nutshell:

    1) Rares J has ruled that the 2006 exemption to the Copyright Act for private copying of TV broadcasts also applies to users of the Optus TV Now service. In other words, he has ruled that it is the customer who is initiating the recording and playback using equipment provided by Optus, in exactly the same way as a customer uses a PVR manufactured by a third party such as Sony or Tivo to record and playback in their own home.

    2) Users of TV Now can only record FTA broadcasts, and absolutely nothing that is on Pay TV exclusively. This means that they will not be able to record most NRL games.

    3) The only customers of TV Now who are able to access the 2 minute delay are those who use Iphones and Ipads. This is because the OS on these devices streams video in Apples Quicktime format. Users of all other mobile devices (i.e. most of the Optus customer base) have to wait until the program has been fully recorded before they can start viewing the program.

    4) All that Optus TV Now customers are doing is substituting the need to lug around a TV to view content to which they are legally entitled to view for free any time they damn well like, if they were to lug around said TV, or happen to be in front of a TV at the time.

  15. floorer

    Hey Liz,just off the top of my head I’m not sure it’s about the advertisers exactly.Telstra etc pay squillions for exclusivity,so if fans want to watch they have to sign up to Telstra.Optus blows in,figures out a way to provide the service without paying for it,but their customers are still paying them(Optus).I’m not sure how big this is now but it’s where it might end up……..why should Telstra or anybody pay the AFL if another provider can through a quirk in the law gain access for free? Personally I hope it turns into a great big bloodbath.The rights owners have been screwing with the viewer for too long,eg delayed coverage.We want it live!

  16. Elworthy Brent

    Floorer and Maikeru have the situation nailed.
    The AFL needs to (very belatedly) “get with the program” – computer program that is.
    It has obviously never occured to the AFL that it could negotiate streaming rights separate from broadcast rights – or better still, set up its own streaming service as Floorer suggests.
    When you merely sit back and wait for others to innovate you get left behind.
    Change the law?
    Sure, and as Maikeru points out, there are squads of programers and app developers out there just itching for an opportunity to make money by producing a work-around the market will be quick to take up.
    Meanwhile, as the prof points out, there is that other law – you know, the one about unintended consequences. . .

  17. Mark Heydon

    Boo hoo, AFL/NRL will take a revenue hit and boofheads without a brain in their head or a positive contribution to society will have to take a pay cut to something closer to what they are worth.
    My heart is bleeding.

  18. Malcolm Street

    Champions of free enterprise running screaming to the government when a competitor comes up with a way around their monopoly – “business” as usual…

  19. NeoTheFatCat

    When a businessman/woman says that they love competition, remember that in their heart of hearts they loathe it and will do everything to manouvre themselves into a quasi monopoly situation.

    As with the music, movie and even book industries, all these people are trying to do is protect the profits from their current business models.

    Innovate or die!

  20. Liz45

    @FLOORER – I see! Interesting isn’t it? These very wealthy groups b******g about not getting enough money out of their flagrant attempts to bleed sport lovers dry at every ‘turn’?

    Who knows what people record now? Who knows if I forward it on to a relative etc or keep it for my own use? How is that illegal?

    It just goes to prove two things – capitalism is never satisfied, they always want to do less and get more money – we’re all being used as ‘cash cows’ for these greedy bastards. Glad I don’t follow so-called winter sports. Don’t have much regard for any of them, nor do I like the misogynist attitudes of too many who play these ‘games’ and or promote them?

    I look forward to the antics over the rights to the Olympic Games. We’ll cop most of what we did last time due to the fact, that everything is orchestrated to gain the most viewers/money etc? Very sad!


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