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Optus wins landmark “Cloud” copyright case

Optus has won a landmark court battle over its TV Now cloud service with the AFL, Telstra and the National Rugby League.

Optus has won a landmark court battle over its TV Now cloud service with the AFL, Telstra and the National Rugby League.

The Federal Court has ruled Optus will be able to continue its cloud platform which allows Optus customers to record and watch matches screened on free-to-air television and replay them.

The platform has delays as short as two minutes on some devices, creating near-live broadcasting. Telstra has a $153m deal with the AFL and NRL to broadcast matches live over the internet which is now in jeopardy.

The decision was based on time-shifting provisions in the Copyright Act which allows individuals to record and watch a show at a more convenient time. Optus’ lawyers have argued that TV Now was a modern interpretation of the video recorder because a separate recording was made for each individual.

Justice Rares said, ‘‘I found that such a recording or film was made by the user to watch it at a time he or she considered to be more convenient than when the live broadcast occurred, even if only by minutes.

‘‘I decided that Optus’ TV Now service did not infringe copyright in the broadcasts of the AFL and NRL games in the particular ways that the rightholders alleged.”

Justice Rares also said some issues might still need to be resolved, including whether Optus infringed copyright with the technology it used to make a recording in a format suitable for Apple devices.

The decision has implications for broadcast rights negotiations for other sports, including motor racing, football, cricket and tennis.

The proceedings were adjourned until Friday so the parties involved could agree on the formal orders that should be made.

Telstra and the sporting bodies are likely to appeal the decision, but not before the AFL season starts on March 24th.

Source: The Age,  The Australian

20 Responses

  1. Reading comments here just shows most peoples lack of understanding of new technology.Its all about apps. @Johnstar- buying a vcr is a business transaction, you pay for the vcr. Tv Now is the same thing,you pay for it. A vcr is physical and Tv Now is the same thing only a new version, an app in the sky. Your phone is the player,just like a Tv. Yes its all becomming blurred and hard to understand but we have seen nothing yet,as technology is moving fast and by the day. The internet have killed record sales as kids download illegally. Performers now have to tour to make big bucks. Maybe the AFL will have to get real and realise tv rights is old world and they will have to confront the same thing that retailers, recording artists,book stores and other have had to.

  2. If I set up a club of “members” or “subscribers”, dowload content from somewhere, which I’m not paying anyone for, and then send to my “subscribers” by DVD or individual download, will I be in trouble? But Optus are allowed.
    Well, the NZ guys arrested recently thought they were able to do that.

  3. @Adam. The difference is that the networks have paid for the content and own the copyright of what they broadcast. The right to then record, for personal home use, was well tested in the Sony/Disney/Universal case decades ago. Manufacturers are not charging a fee to view certain content. From where is Optus getting the content to send to their subscribers? Is Optus paying for the content they are effectively taking and selling? No. That’s the difference.

  4. Interesting comments from all. I recently ditched Optus as a provider as I couldn’t get coverage where I live (7kms from Sydney CBD) so I wonder how interrupted the coverage will be. While I don’t mind seeing highlights on an iPhone I wouldn’t even consider attempting to watch a game. The big consequence will be for the sporting bodies who won’t get the big dollars. Ch7’s safe with their $150m deal with Telstra over the next 5 years but the NRL will miss out.

  5. @Kenny by that logic should the networks be suing the manufacturers of VCRs, DVD recorders and PVRs because they provide their service (the ability to record transmissions to be watched at a later time) for a fee (the sale price)? Should I demand IceTV be thrown into the mix for being an enabler of this act by providing me with guide data, also at cost?

    I would be actually surprised as to the number of users of this service that Optus would actually have, regardless. But the real question Telstra should be asking is “Why is there a market for this service?” and taking that matter up with the codes who sell rights to FTA providers who often screw over the viewer.

  6. @Secret Squïrrel- “Optus will only be transmitting a specific FTA program that an individual has decided to record and watch later”.
    Isn’t that the key? Optus is taking someone’s signal that they don’t have rights to and transmitting it, for a fee, to Optus customers.
    “They will still get all the ads”. Which ads? The ads on TCN9 or WIN or NBN or…???

  7. You’ll still need to use the terrible Optus mobile data network so I doubt anyone will bother…you’d start off 2 min behind and be half an hour behind by the end of the first quarter due to all of the ‘buffering’

  8. Heard Eddie McGurie wingeing about this on radio this morning. Made it sound like you could watch any AFL game for free in only 90 seconds delay. Firstly this is esentially a VCR for your phone and only free to air (in your city region). I don’t think you can even watch the a show until its finished recording anyway!? Plus you only get 45 mins record time free and can only record full programs from the TV guide (therefore you cant even watch a game for free cause its over 2 hours!).

    Also has anyone actually used this service? The quality is Poor. According to Eddie this morning said people could hook up their iPhone to their TV to watch it (?) Why not just watch it on TV in the first place!

  9. This outcome isn’t surprising. There’s no way the Copyright Act can keep up with the pace of change.

    The time shifting exception was never designed to deal with services such as these. It was all about the home VCR. And before anyone likens TV Now to a VCR, the difference is that TV Now is a business charging customers. Whereas there is no business transaction when a VCR is used.

    They are completely different. The fact that TV Now has been ruled to have been within the exemption comes down to intricately detailed technical questions – retrofitting an analogue concept onto a digital product.

    There needs to be a change to the legislation to stop businesses ripping off other people’s services and flogging them to consumers for a charge.

  10. Even though i don’t support telstra very often this seems really unfair to them. Paying all that money for rights and Optus is basically allowing customers to stream content at a 2 minute delay.

  11. Definitely the correct decision. Optus will not be broadcasting anything, it will be unicasting. It’s completely different from, say, the Seven Network recording and then broadcasting something from another network.

    Optus will only be transmitting a specific FTA program that an individual has decided to record and watch later. No-one else will have access to that recording. It’s no different from that same person recording a program off their TV and storing it in the cloud to stream to a mobile device later.

    They will still get all the ads so the commercial networks and their advertisers won’t dip out. Telstra are understandably upset, but they bought the rights to “broadcast” via the internet (actually multicast). This is entirely different but Telstra are about 10 years behind the leading edge so it’s not surprising that they don’t have a full understanding of this internet thing.

    I have no doubt that this will be appealed, and all the way to the High Court, same as with the AFACT v iiNet case. Another example of a dinosaur trying desperately to hanging on to their market monopoly and holding the rest of us back with outdated thinking.

  12. Weird. Sure “the user” can record and replay later but how do they get the transmission in the first place? By Optus transmitting something they don’t have rights to transmit. A hell of a lot different to recording TV programs that the broadcaster has rights to broadcast.
    High Court here we come. Overturn.

  13. > What’s to stop for example, Ch 7 ‘recording’ the NRL games…

    The issue was “individual use” (the modern VCR in the cloud analogy) compared to the broadcasting of Ch 7 in the proposed example. You couldn’t argue that Ch 7 is making “individual” recordings, it’s broadcasting!

  14. What’s to stop for example, Ch 7 ‘recording’ the NRL games as they are broadcast live on Nine and airing them at a 2 minute delay (or the opposite for AFL, Tennis, etc.!) . This case is stupid and Telstra must appeal (and hopefully will win). Shame on Optus for even trying this cheater’s tactic.

    Maybe even a change in the Copyright Act may be warranted!

  15. i might be wrong, but it’s only for the fta games. telstra have threatened to tear their contract up with the afl. i doubt they will. but optus might be a player with the nrl rights maybe

  16. Today with the internet used for much more than email and looking at dirty pictures I think it’s time for a re-fresher course in what out legal rights are when it comes to recording TV shows on FTA and PayTV and their associated online services.

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