Optus Web Copyright Victory Explained

This week's Federal Court ruling that Optus customers are able to view sporting matches minutes after they are streamed live without breaching copyright is a landmark decision that alters our understanding of copyright law, and has significant implications for the AFL's broadcasting rights deal.

The ruling, by Justice Steven Rares in the Optus v Telstra, AFL and NRL copyright case, finds that computers (including tablets such as the iPad) and mobile devices such as iPhones and smartphones are now the modern equivalent of the video cassette recorder.

Individuals are now able to record free-to-air broadcasts onto their computer or mobile device and watch the broadcast moments after the original broadcast – which in many cases will be live – without breaching copyright.

Justice Rares found that Optus customers, rather than Optus, had made the recordings of the live or pre-recorded free to air AFL and NRL games using the TV Now service. Optus customers were then able to watch the game at a time convenient to them, potentially a few minutes after the original broadcast.

Under the Australian Copyright Act, individuals are able to make:

a cinematograph film or sound recording of a broadcast solely for the private or domestic use by watching or listening to the material broadcast at a time more convenient than the time when the broadcast is made.

What the Optus customers did using the TV Now service is known as "time shifting". The Act does not state a time period such as a day or hour that must be observed before time shifting can occur. So the fact that in this case, the time shifting occurred within a few minutes of the original broadcast is not a factor under copyright law.

Given that the Federal Court has found that there has been no copyright breach by Optus customers in their use of the TV Now service to record and view live or pre-recorded free to air AFL and NRL games, this activity can continue.

The Court’s finding (if it is upheld by the Full Court of the Federal Court) could de-value broadcast and media rights for sporting events. For sporting organisations that heavily rely on media and television for income this could place them at financial risk.

For the AFL, the value of its five-year $1.25 billion broadcasting media deal with the Seven Network, Foxtel and Telstra could be reduced – particularly if Telstra attempts and succeeds in voiding the agreement for exclusive rights to the internet and mobile services of AFL games, worth over $150m. It has further implications for future deals.

The big losers will be the football clubs and the players. Potentially, the AFL will attempt to re-negotiate with the AFL Players Association in regards to the collective bargaining agreement. Clubs could also be placed in financial risk if their funding was to be reduced.

The decision for Telstra means it has potentially over-valued the rights for exclusive uses of the internet and mobile services of the AFL, given that based on this ruling, the mobile services to AFL games are not the exclusive rights of Telstra and their customers.

Obviously, Optus is the big winner with potential increases in customers to their News TV service and revenue from data charges as a result of the recordings of the broadcast videos.

But this is not likely to be the end of the issue. Expect the AFL, NRL and Telstra to lobby the Australian Government for changes to the Copyright Act, which is currently being reviewed.

This review, announced last October will examine “whether the exceptions [such as time and format shifting] in the Copyright Act are adequate and appropriate in the digital environment”.

A leave to appeal to the Full Court of the Federal Court has been granted. The AFL, NRL and Telstra have all indicated that they will be appealing. So stay tuned.

Marita Shelly is a PhD candidature within the Graduate School of Business and Law at RMIT University. Her PhD topic is in the area of copyright law and universities.

This article was originally published at The Conversation. Read the original article.


Comments

    This is a clear win for the consumer.
    As for broadcast rights it simply means the tv broadcast rights will increase in value as the mobile broadcast rights become more useless.

    I honestly couldn't have imagined this going any other way. It would've been a ridiculous legal battle defining exactly what tv you could and couldn't record and on what devices you could do so.

    If people are mixing tv with phone, it just means one more viewer for the tv channel.

    The content Optus is streaming is coming from live, free to air television.

    Online content agreements can still exist within this context, however it will mean that less content will be published on free to air television and content owners and distrubuters will push more content onto pay-to-view services such as Foxtel.

    If this is decision is upheld, then I would imagine that whilst this will be a win of sorts for consumers it may hurt consumers in the long run as companies seek to tie up content through channels which provide them more control over their content (a.k.a Pay-to-view services).

      Won't happen. Many of the more popular shows make an astronomical amount of money from advertising, product placement and things of that nature than they ever could with pay per view or subscription models.

    Unless I am missing something, I cannot see the big fuss.

    If I understand correctly, this records *Free-To-Air* only right? It's not like we can record Foxtel channels without have to pay Foxtel for the service. Why is this any different to recording free-to-air on a home PVR and watching it on TV?

      And that's just the point the Judge was making. The only people making this noise are greedy media companies and sporting organisations that can't keep up with the changes in technology.

      I'm with Optus but what I do currently is remote into my computer at home from my phone. Start up Media Centre and watch live TV on my phone or record it, and sometimes watch it back time-shifted on my phone.

      The case is ridiculous, it could only go one way. There is no way they'll win the appeal.

    If this service was re-broadcasting the Free-to-Air service live, I believe this would violate the terms of the law. This service does not do this. It is a recording and reply service.

    This capability exists already, but not as a service. For example, I have one of these (http://www.elgato.com/elgato/int/mainmenu/products/tuner/netstreamdtt/product2.en.html) and with a broadband connection and appropriate networking, I can do exactly what the Optus service does (replying recorded TV on Computer, iPhone or iPad whereever I am). In the US, people have been doing this for ages with a product called a 'Slingbox'.

    I guess it has drawn the attention of Telstra because it is the first time this type of thing has been offered as a 'Service' rather than a product that you buy and install at home. They don't have it of course as well. They have paid big money to AFL and NRL for their 'AFL' and 'NRL' Bigpond channels. Telstra still have exclusive rights to play things live. That is what broadcast rights have always been about I thought?

    Without knowing the exact details of the law, my question if I was the judge would be around what technology Optus are using and how Optus are delivering the service. I presume the customer 'must ask to record' something before it happens and cannot view something that they have not requested to be recorded? If they could, I think there would be issues. I would also argue that if multiple people want to record the same thing, Optus must be making individual copies of the recording. If they are not, then the recording they are making are not 'for personal use', since they are in essence broadcasting to multiple people.

    Personally, I don't see much value in the offering, particularly based on the amount of storage, the cost and the fact that you can only use it with Optus Mobiles. But I think for the general populous, it is a great simple solution.

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