The Optus TV Now service has been given the stamp of approval by the Federal Court of Australia today. The service, according to Optus, allows a user to record and watch later free-to-air TV shows on a user’s mobile or PC. It allows an Optus customer the freedom to record TV shows anytime, anywhere to play back later at their convenience on as little as a two minute delay.
The service began in July 2011 and raised the suspicion of the AFL and NRL. The winter football leagues claimed that Optus’ service infringed on the copyright of match broadcasts owned by both leagues. Telstra holds the mobile & internet broadcast rights for the AFL and NRL in Australia.
The AFL, NRL and Telstra brought proceedings against Singtel Optus and Optus arguing that Optus had breached the Applicants’ copyright in broadcasts of a number of AFL and NRL games made in September and October last year.
Justice Rares in the Federal Court Judgment Summary said that the Optus TV Now system works by a user clicking “the “record” button for a program in the service’s EPG, [and then] Optus’ equipment records that program individually for each user…These copies were stored in Optus’ NAS (network attached storage) computer in its data centre. The user can view the recording in the 30 days following the time of the original broadcast. When a user clicks “play” on his or her compatible device, Optus’ data centre streams the copy of the program in the appropriate format to that device so that the user can watch it.”
Optus relied on Section 111 of the Copyright Act 1968 (Cth) to argue its service did not infringe the Applicants’ copyright. Section 111 applies:
“…if a person makes a cinematograph film or sound recording of a broadcast solely for private and domestic use by watching or listening to the material broadcast at a time more convenient than the time when the broadcast is made.”
Under s111(2) of the Copyright Act if the recording is for such purpose the recording will not infringe the Applicants’ copyright in match broadcast.
Justice Rares held that the user ‘clicked’ the record button despite Optus providing the technical infrastructure for recordings to occur. This was akin to an individual using a VCR to record a television show and therefore Optus was not making the recording but the user was.
The recordings were held not to infringe s111(1) & (2) Copyright Act 1968 (Cth) because the “evidence suggested that individual users had made the recordings using the TV Now service solely for their private and domestic use by watching the recordings at a more convenient time .”
As the service was directed at individual users and in effect controlled by that user as to what was recorded and what was played when, it was in fact the user making the recordings and not Optus. As a result Justice Rares held that the Optus’ TV Now service did not infringe copyright in the broadcasts of the AFL and NRL games as alleged by the Applicants.
The outcome of the case has reportedly put Telstra’s newly purchased AFL rights in jeopardy as they are potentially devalued because Optus can provide near live coverage to its customers when AFL matches are broadcast on free-to-air.
The AFL, NRL and Telstra have been ordered to pay Optus’ costs, but given the likely commercial impact of the decision leave to appeal to the Federal Court’s decision to the Full Federal Court has been granted without need for a formal application.
The AFL’s Chief Operating Officer Gillon McLachlan said on AFL.com.au,
“We maintain that the Optus action is a breach of copyright. However, we are only in the preseason of this issue – it is highly likely we will appeal.”
Telstra spokesman Craig Middleton told Fairfax Media outside the Court that,
”This is an early stage. We remain committed to protecting the content rights in which Telstra has invested, in which the sporting bodies rely for income and which ultimately flows through to the fans of our sports.”
Frost Global will continue to monitor this case as more news comes to hand.
Singtel Optus Pty Ltd v National Rugby League Investments Pty Ltd (No 2)  FCA 34
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