Coalition defends the Murdoch monopoly

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ScreenHunter_2269 May. 05 13.30

By Leith van Onselen

The Abbott Government looks set to bow to media industry pressure and implement laws to curb copyright infringement. From the Brisbane Times:

Fairfax Media has been told that federal cabinet will consider two proposals to crack down on illegal downloads as early as this week.

One is internet service providers being required to issue warnings to people who repeatedly download illegally. The other is forcing ISPs to block file-sharing websites such as Pirate Bay…

[Senator George Brandis] has argued that ISPs ‘‘need to take some responsibility’’ for illegal downloading, because they ‘‘provide the facility which enables this to happen’’…

News Corp Australia, half owner of pay TV company Foxtel, told Fairfax Media that copyright infringement ‘‘hurts the creative community – it undermines investment, employment, business models and innovation.

‘‘We support the Attorney General’s approach, and while there isn’t a silver bullet, evidence from overseas suggest that such initiatives do work,’’ spokesman Stephen Browning said.

There is a reason why piracy is so rife in Australia: purchasing content legally is often far less convenient than unauthorised downloading over the internet. Foxtel’s exclusive arrangement with HBO to broadcast Game of Thrones and True Detectives is a case in point. Under this arrangement, Australians can no longer legitimately purchase these shows via ITunes or other sites until the final episode has aired on Foxtel, effectively forcing consumers to choose between buying an expensive Foxtel subscription or online piracy.

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Moreover, the cost of copyrighted content in Australia is usually far more expensive than elsewhere. For example, a subscription to streaming service Netflix in the USA costs only $8 per month versus $35 (increasing to $50) per month for Foxtel’s sub-standard offering.

Indeed, it is the extreme geo-blocking and protection that surrounds much international content distributed through Australian cable television that is driving consumers to seek alternative sources, albeit on an unauthorised basis.

Rather than taking draconian measures, the Government should instead be acting in consumers’ interests and seeking to free-up the market for content, so that purchasing it legally is as convenient as illegally downloading from the internet. This requires an end to exclusive deals and the ability to purchase content in a variety of formats from a variety of locations, as well as making it legal to convert files as one sees fit for private use.

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Finally, there is the issue of who will pay for the Government’s crack-down. Brandis’ proposal to require ISPs to effectively police copyright – “secondary liability” – is a retrograde step and could raise internet costs for all users. The proposal would effectively remove the burden of enforcement from the digital creators and the courts to ISPs, many of whom aren’t equipped to interpret copyright law, adjudicate on the facts, and impose appropriate penalties.

The ISPs are united against the Government’s proposals. According to the above article, iiNet chief regulatory officer Steve Dalby, claims that “ISPs should not be held responsible for ‘protecting the rights of American companies’ and the above changes could cost ‘in the order of tens of millions'”.The industry body for ISPs, the Communications Alliance, has also argued that “rights holders should fund the cost of any scheme, and ensure that content is available quickly and affordably”.

Overall, the Government’s stance on copyright suggests that Australia hasn’t moved on much from the days of the VCR, when it was illegal to to use them to record television programs. And as long as such an inflexible approach is taken, consumers will continue to embrace alternatives and download unauthorised content over the internet.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.