The ruling against Optus' TV Now mobile-content service reinforces the idea that content providers should be able to exclude and financially punish consumers for using particular technologies, going against the idea of the Convergence Review.
Only Optus knows whether its judicially rejected and now-suspended TV Now mobile-recording service has become a casualty of an overzealous content cartel, or whether the Telstra-AFL-NRL action correctly stymied the company's sneaky efforts to figure out a way to deliver mobile footy without paying for it.
There is certainly precedent to assume the former, since one perspective could suggest that Optus was only facilitating the recording of a sports match for which free-to-air (FTA) networks had already paid the rights.
If it's legal to use TV Now to time-shift FTA shows like Judge Judy, The Voice and Millionaire Hot Seat, why should it not be also legal to time-shift FTA broadcasts of AFL or NRL games? After all, nothing that's aired on free-to-air TV channels is done without an appropriate licence, and legal precedent has supported the consumer's right to extend that licence to recording for personal use; all that TV Now does is provide a different way for consumers to assert that licence.
The TV Now decision has put the squeeze on Optus — but will it also let content owners clamp down on the very freedoms that the Convergence Review espouses? (Vise image by Glenn McKechnie, CC BY-SA 2.5)
In using a copyright-infringement offence to sideline what they see as a threat to their long-established sponsorship models, the AFL and NRL have turned the tide on years of progress in supporting consumer empowerment and freedom in content consumption. They may have sold Telstra blanket rights to the transmission of this specific content to mobile-wielding users, but their ability to interfere with logical progressions of consumer-protection laws suggests that content holders can decide how, where and with which devices their customers can access their content.
"But wait a second," you say. "Apple has been doing this for years through its iTunes Store. So have Google, Quickflix, Telstra and anybody else selling online content; they say what you can do with their content, and whether you can access it on your mobile or not."
Sort of. Yet, the TV Now case is inherently concerned, not with explicit restrictions, but with implicit ones: does the freedom that Optus would have enjoyed in recording FTA extend to mobiles? This is different than having content producers explicitly limit their content licences to exclude specific devices. It's worth noting, by the way, that networks like Nine and Ten have enforced a de facto no-mobiles policy by building their catch-up TV services in Flash or Silverlight — neither of which are supported on iPhones or iPads (and let's face it — you may love Android, but iOS devices remain the litmus test for services like this).
The Convergence Review's release highlights the still-yawning gap between consumer-focused ideals and market realities.
This enforced technological isolation, especially when it is perpetuated by content providers, is exactly one of the issues that the Australian government's long-running Convergence Review was designed to address. The wording of the Convergence Review's final report would have been finalised long before the TV Now decision was handed down, but its release, just one business day later, highlights the still-yawning gap between consumer-focused ideals and market realities.
Sprinkled throughout that report, after all, is one quite clear principle: that consumer access to content should not be dictated by any specific technology. Or, as the report's authors put it:
Today, content that was previously only delivered in a cinema, on television or in a newspaper can be accessed on devices such as smartphones and tablets. However, this content is regulated differently, depending on how it is accessed. There should be a flexible and technology-neutral approach to content regulation that reflects community standards.
Making content available to users via one medium, but banning it on another medium, should, under this philosophy, be verboten — and yet, that's exactly what the TV Now decision facilitates. Can it be long before other FTA content providers start asserting their own rights — pushing for lucrative mobile rights deals that amount to double dipping from consumers who just want to watch their shows?
The inevitable High Court appeal could go either way, since previous courts have already offered different interpretations of the law, which will variously support and refute Optus' argument.
Optus could perhaps have complied with the letter of the current decision by adjusting TV Now to filter out football matches, but it has suspended the service entirely, because it can see the writing on the wall.
But if a consumer can be excluded from watching time-shifted, freely available content simply because he's looking at a smartphone screen instead of sitting in his lounge room, how long can it be before content providers start preventing other shows from being time-shifted?
MasterChef, for example, makes money by forcing internet users to watch short videos before their on-demand clips. If MasterChef wants to boost these revenues by capitalising on growing demand for TV Now-like mobile services, what would stop its producers from asserting a copyright claim against Optus to stop TV Now users from recording their show — and instead redirecting those users to its own portal?
It's a situation that I warned about when Optus won its previous TV Now decision back in February. It's like what happened years ago, when copyright holders descended on YouTube to lodge blanket objections to the posting of copyrighted movie clips, music videos and the like. And while the media-consumption environment has changed dramatically since then, the TV Now decision shows that the courts aren't ready to hand over all control to consumers quite yet.
The TV Now decision shows that the courts aren't ready to hand over all control to consumers quite yet.
That's a pity, because the Convergence Review is arguably a heavily pro-consumer document. It endorses a principles-based policy framework, "to ensure the policy framework can respond to the future challenges of convergence. An independent regulator and a principles-based approach would provide increased transparency for industry and users — 'black-letter law' regulation can quickly become obsolete in a fast-changing converged environment, and is open to unforeseen interpretations."
The review explicitly seeks to minimise those interpretations. Recommendation 1a, for example, discourages parliament from making legislation "that either favours or disadvantages any particular communications technology, business model or delivery method for content services". Recommendation 2 advocates the elimination of barriers to market entry for the supply of content or communications services. Recommendation 3b calls for holding large content providers "to meet community expectations about standards applicable to the content they provide".
And, of course, Recommendation 8 argues that the regulator should be empowered to investigate "content-related competition issues". You know, like when one broadcaster utilises lawsuits to prevent a competitor from accessing content that it wants total control over.
It's not clear yet how much legislative sway the Convergence Review will carry on lawmakers, but, in the meantime, it's not unreasonable to call the decision a do-or-die moment for free-to-air TV. After all, if media reform can't preserve the right for consumers to access FTA content in a way that's convenient for them, they'll move to pay-TV services that can.
This would fulfil the content providers' claim to manifest destiny over their content, and subject consumers to new charging models that punish them for the increasingly common act of using mobiles to access premium services (this is a particularly punitive condition, because contracts prevent consumers from regularly switching mobile networks just to access exclusive content).
It's also a massive rebuke to the likes of Optus, which began offering TV Now as a value-added service, and fully intended it to be a drawcard for new "4G" mobile services, like those it launched in Newcastle last week. If Telstra can continue to successfully block Optus from offering certain content to its mobile customers, freely available content could become just another pawn in the ongoing battles between the content giants.
What do you think? Did Optus get the short end of the stick? Or is it entirely reasonable to block mobile users from competitive options for watching the footy? And will the Convergence Review change the situation?
Also: by my count, this is my 250th Full Duplex column. As I've done every year, I'd like to solicit your thoughts, comments and concerns: is there anything you'd specifically like to see addressed? Anything you love, or hate, about what you're reading here? Add your comments below, or contact me at fullduplex at braue dot com. I look forward to hearing from you!