Optus loses TV Now appeal

Optus loses TV Now appeal

Summary: The full bench of the Federal Court has ruled today that Optus and its customers jointly make recordings for the Optus TV Now service, and, as such, Optus is in breach of the Copyright Act.

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TOPICS: Telcos, Hardware, Legal, Optus
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The full bench of the Federal Court has ruled today that Optus and its customers jointly make recordings for the Optus TV Now service, and, as such, Optus is in breach of the Copyright Act.

Optus TV Now, first announced in July, allows customers to use Optus' storage cloud to schedule, record and playback free-to-air digital TV on 15 channels from a 3G mobile or PC. The court's view is that the app is not covered by time-shifting provisions in the Copyright Act, because it is Optus, or Optus and the customer jointly, making the recordings.

"Optus could be said to be the maker in that the service it offered to, and did, supply a subscriber was to make and to make available to that person a recording of the football match he or she selected. Alternatively, Optus and the subscriber could be said to be the maker for Copyright Act purposes, as they acted in concert for the purpose of making a recording of the particular broadcast which the subscriber required to be made and of which he or she initiated the automated process by which copies were produced," the court's judgment said.

The court said that Optus cannot, either as the maker alone or as the joint maker with the subscriber, claim to be exempted under the copyright provisions, because it is not considered to be for "private or domestic use".

The National Rugby League (NRL) had claimed last year, after Optus launched the TV Now app, that it infringed on its copyright.

Optus pre-emptively took the NRL to court, seeking to show that TV Now does not infringe on the rights of the sporting code. Optus stated that the user is making the recording to watch at a time more convenient to them, which is allowed under 2004 provisions in the Copyright Act.

Telstra and the Australian Football League (AFL) joined the case, as both were concerned that the app calls into question the $153 million deal that they signed together to give Telstra exclusive mobile broadcasting rights for the AFL.

Late last year, Justice Steven Rares ruled in Optus' favour, saying that the act of recording initiates when the user hits the record button on the TV Now app, which he said is no different to the act of recording using a VCR or a digital video recorder.

In March, the NRL appealed the decision, arguing before Justices Arthur Emmett, Annabelle Bennett and Paul Flinn that Rares erred when he ruled that it is the user, and not Optus, who initiates TV recordings in its TV Now app, pointing to the four copies that Optus makes for each recording. The NRL argued that the user making the recording is likely "wholly ignorant" of the fact that when they press record, four different files are made, to ensure that the user can view the recording on iPhones, Android devices, computers and other 3G mobile devices.

In response, Optus argued that it merely provides the instructions to a user for how to record the TV broadcasts that they want, and ultimately the user makes the recording based on that instruction.

Optus' general manager of corporate and government affairs Clare Gill said that Optus is disappointed with the decision, but will comply with the ruling.

"We are currently reviewing the decision and considering all options available, including appeal," Gill said. "We intend to keep leading the market with innovative and differentiated digital services."

Telstra said the judgment was a great result for "everyone who cares about the financial health of Australian sport".

"It ensures that sports bodies, and Australian content owners more generally, are able to receive a fair return from their property," the company said in a statement, adding that the decision would allow rights holders to invest in improving the quality of their content.

AFL CEO Andrew Demetriou said on the AFL's news site that the court made the right decision.

"It's a great win ... It's a sensible decision for all sports that relies on this funding, which is re-invested into facilities, grounds and the code," Demetriou said.

Demetriou said Optus must now suspend recording broadcasted AFL matches through the TV Now app.

Comments on the judgment from the NRL is being sought.

Updated at 10:23am, 27 April 2012: Added comment from Optus and the AFL.

Topics: Telcos, Hardware, Legal, Optus

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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16 comments
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  • So does that mean Foxtel and I jointly make recording on my Foxtel IQ, so Channel 7 can now sue Foxtel for copyright infringement? Another one for the High Court I think.
    phildobbie
  • My first thought too. However, Foxtel have contracts in place that allow them to rebroadcast FTA channels. I imagine they could also cover timeshifting.
    mpm123
    • No, Telstra cannot cover timeshifting for private or domestic use because that freedom is covered by the Copyright Act.
      TomAnderson-3ecad
  • One imagines that this was all about Telstra/NRL/AFL being able to charge Optus and their users to do this, as Foxtel (I think) do with IQ
    meski.oz@...
  • Bad, the full ruling means that cloud based recording of free to air broadcast media (not talking TV Now specifically, but generally for anyone who wants to provide a service like that) is against the copyright act. This is going to stifle innovation especially moving into an "NBN World" where the benefits of being able to record something and then play it back wherever you are on whatever device would have been a key benefit.

    A far better solution would have been either to enforce a blackout on cloud based services being able to record events already covered by a specific broadcast agreement, or to enforce that the event must be recorded and watched on delay once the recording is complete. Yes these would require an amendment to the copyright act, but at least it wouldn't put hold a genuinally beneficial product idea.
    Tezmyster
  • Maybe, since it is either Foxtel making the recording. Alternatively it is you and your Foxtel IQ making the recording, since you don't know exactly how the Foxtel IQ is able to make the recording. Furthermore, since the average consumer doesn't know how a VCR works, you are wholly ignorant that the VCR creates multiple files, including a file for the video and a file for the audio. Therefore, a VCR also contravenes the Copyright Act. Since a VCR does not contravene the Copyright Act as the recording is for private use, we can see that the court has either arrived at a fallacy or has not hit the central issue in its judgement.

    The question in this case is whether a VCR that is located at Optus headquarters can be controlled remotely by the customer. It is ignorant of the technology to say that because the VCR is located somewhere that the people who own the building are the makers of the video. Let's say that I own a fully furnished rental home. My remotely activated VCR is located in my home, and I activate the VCR using my phone while on the bus. It does not seem to me that the owner of my rental home is the maker of the video. Nor does it seem that both the owner and myself are the maker.
    TomAnderson-3ecad
    • I meant to mention in my example that the remotely activated VCR in my rental home is owned by the owner of the home. It is strange to claim that when I press record from my phone on the bus that the owner of the home is making the recording. The judges are not familiar with these types of technology (e.g. Slingbox) so apparently didn't make clarifying scenarios.

      By the way, the Telstra IQ can be activated remotely. I rent a room that comes with a Telstra IQ. I feel strange to think that under the judgement of this court, when I activate the record function, the homeowner is actually making the recording. Can't I make recordings anymore???
      TomAnderson-3ecad
      • TomAnderson,

        A valid point for comparison. But if you were a corporation and flogging the recordings to thousands, you would also be in the same spot of bother.
        Vasso Massonic
  • It was to be expected. The days of freebies and cherry picking are over. Optus should realise and respect, that like for everybody else, stock in trade is bought and not pinched.
    Vasso Massonic
  • LOL... NWAT lives...

    FFS how hard is to to accept Telstra received the PSTN under strict access laws for all comers.

    IT WAS LAW, ACCESS WAS LEGAL. Yes it affected your share price, yes Telstra's most disgraceful management team ever brainwashed (via NWAT) those stakeholders into believing poor, poor me... BUT oh dear you should have known... BAD LUCK.

    But going by your own rules, your Mary Poppins (practically perfect in every way) Telstra, are/will soon be, NBN freebie, cherrypicking, leeches. Won't they?

    For God's sake let it go. As you were told when vehemently opposing the NBN and seeing your more precious than life itself TLS shares plummet, once delivered your junk bonds would recover.

    Gee look, how 'bout that!
    Beta-9f71a
    • Ooh before it is mentioned, I know the topic wasn't PSTN...

      But this is simply a continuation of the same old leeches rhetoric, from "some"...!
      Beta-9f71a
  • Beta give up and stop floggin' a dead horse. Did you see Andrew Demetriou pay out on Optus and ask every sportsman in Australia to swap any Optus contracts to Telstra's "superior systems". Oh! by the way Beta did you hold onto those Telstra shares????
    sydneyla
    • LOL...

      Oh he and his idiot mate, who cried about their precious TLS shares being decimated by the NBN and told, no... now are being mouthy because they were wrong ... OMG.

      No I didn't Syd, I sold them ages ago (as I told you, took my 7 - 8% in 6 weeks and moved on, again as I told you at the time, so I'm not making it up). Bought bank shares actually and admittedly, initially went backwards but all good now thank you very much.

      And how are your's and what about your mate, still losing eh (but, but, but the dividend...)!

      Yes sterling performance. TLS have now made 10% in almost 15 years (but, but, but the dividend...whatever).
      Beta-9f71a
      • Made 10% on T1 that is.

        If you average all 3 tranches (which is probably the correct way to do it) Telstra even having picked up $1 over the past 12 months, is still down over 25% overall.
        Beta-9f71a
  • Hi Syd

    Don't be cruel to horses, Octopus is more like it!

    I guess we can now safely rest our case. People are nuts about Telstra all of a sudden, Telstra even dropped soft porn. Why dabble with dirt when we achieved the impossible.

    Regards
    Vasso Massonic
  • People are going crazy about Telstra... BECAUSE OF THE NBN LIKE I TOLD YOU 2 YEARS AGO and you argued and argued and argued...

    Now, you rest your case...LOL!!!!!!!!
    Beta-9f71a