iiNet judgement looms over ISPs' future

Judgement for the "landmark" case of iiNet versus AFACT will come on Thursday, but with Senator Conroy, lobby groups, consumers and industry members all weighing in on the result, what might the case mean for digital piracy?

Legal proceedings began between Perth-based internet service provider (ISP) iiNet and the Australian Federation Against Copyright Theft (AFACT) in November 2008, when the federation brought the case against iiNet for failing to pass on its copyright infringement notifications to the ISP's customers. AFACT represents its members which include Hollywood studios Village Roadshow, Disney Corporation, Fox and Universal as well as Channel Seven.

Sabiene Heindl, general manager of Music Industry Piracy Investigations (MIPI), supports AFACT and believes the judgement next Thursday will hopefully make ISPs more willing to engage in meaningful action towards countering digital piracy.

"The likelihood is we would expect to the see film industry successful in this court case. Our analysis has always been that ISPs must accept responsibility for infringements on their networks when it is brought to their attention," she said.

"In the Cooper case, which we took to court, both Cooper and the ISP were sued. The ISP was liable as it was aware and failed to take reasonable steps to address the copyright that was occurring. Likewise, iiNet has been put on notice of copyright infringement on its networks, but failed to adhere to its own terms and conditions and therefore we would say, has authorised copyright infringement."

Others, like president of the Pirate Party Australia David Crafti, believe the role of ISPs is to act as a utility, rather than police individuals using their services.

"We're hoping for ISPs to be recognised as just regular utilities and there shouldn't be a distinction based on the fact that they can inspect content. Australia Post also can't inspect content but that would be seen as a violation of privacy — we think ISPs should be treated the same way," Crafti said. "If ISPs aren't treated as utilities this case could have massive implications — people won't be allowed privacy, ISPs will be turned into internet cops."

AFACT had expected iiNet to act when its users infringed copyright. It had sent over 7500 breach notices to iiNet including the IP addresses of its customers that were allegedly using the ISP's internet access to infringe copyright.

It wanted the ISP to choose one of several options, which included giving the customer notice, capping download speeds, or suspending browsers or peer-to-peer services. Statements made by Village Roadshow's general counsel, Simon Phillipson, suggested Roadshow's decision to join in the litigation was cost-based, as ISP input was less costly for the studio than individual cases.

"Roadshow considered what an ISP could do, and the steps it could reasonably take without great cost or effort, and that was one of the factors in Roadshow considering this litigation," he said during the case. "That was a relatively cost efficient exercise and more cost efficient than Roadshow litigating against those individual users."

iiNet stands behind the Telecommunications Act as justification for not passing on notifications. Yet broadband minister Stephen Conroy has not ruled out the idea of legislative change to enlist ISPs.

"The court case may settle this issue..." he told ARN last December. "It may show to the world ISPs have got the responsibility to work with copyright owners to work out a solution or to monetise a solution."

Others also argue ISPs need greater governmental prodding, with RMIT general counsel, John Lambrick, also stating in December, "The Federal Government should not wait for a verdict in the AFACT legal action to provide a 'resolution' to the problem... The Federal Government should take action to legislate an effective solution that will facilitate downloader accountability and protect ISPs and other providers of communication infrastructure from liability."

Certainly all eyes are on the case, which may define the role of ISPs in years to come.

To see the progression of the trial, and for links to prior articles, see our iiTrial timeline.