Once Again: The iiNet Decision Did Not Make Unauthorized Downloading Legit

from the common-sense dept

Fri, Feb 12th 2010 8:44am — Mike Masnick

Duncan points us to an article written by Australian actor Roy Billing complaining about the recent iiNet decision and going on to bitch about all the people "stealing" from him when they download an unauthorized copy of a film. What's nice is that if you look through the comments on the article, the vast majority of them are well-informed and explain, quite clearly, why Mr. Billing doesn't seem to know what he's talking about. It's really great to see this sort of response on nearly every article that pops up like this. More and more people are understanding the basic mechanisms of the market, and they're speaking out when people pretend that the world should adjust to them, rather than they should adjust to the world.

But our industry, worldwide, is under threat from piracy. Those who illicitly copy movies and sell them as cheap DVDs and who illegally download movies from the internet are jeapordising the future of homegrown Australian TV and films. Free access to the internet is fine but not when used to access our content for free.

Who gets free access to the internet?

Last week a very important case brought by the Australian Federation Against Copyright Theft against one of the internet providers, iinet, over its failure to stop illegal downloads of films and TV shows found in favour of the internet provider. I am disappointed with this court ruling and believe that in view of the constantly changing online environment, the federal government should be looking at the current situation and drafting legislation accordingly.

Why? Seriously. Why should it be the responsibility of a third party to get between a civil dispute between two parties? It makes no sense. And, as the court clearly pointed out (though, it does not appear Mr. Billing actually read the decision) the problem is that copyright infringement is not just something that "you know it when you see it." It's a lot more complex than that, requiring a trial to actually ascertain infringement. Simply telling ISPs that they have to stop infringement on accusation makes little sense.

But Mr. Billing implies that the ruling effectively legalized unauthorized downloading, when it did nothing of the sort. It simply said that studios should not and cannot rely on someone else to try to step in and protect their old business model. The real issue, though, is that the studios don't want to adapt and don't want to try new business models. But, in Mr. Billing's world, the old business model is the only possible business model:

In Australia, film and TV budgets are usually low and we actors often take lower fees than normal so a production can be filmed. We hope that extra income will come from residuals or royalty payments from overseas sales and sales of DVDs.

Contrary to popular belief most movies do not become profitable from their theatrical releases. A movie depends on its full life cycle from cinema tickets to DVD sales to online distribution before producers and investors can recoup their investment.

Yes, that's the way the business has been done for the last couple of decades, but things change. In fact, this is not, at all, how business was done just a short while ago. While Mr. Billing insists that actors "rely" on homesales of DVDs in the aftermarket, it was just about twenty-five years ago when Jack Valenti of the MPAA warned that: "I say to you that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone."

According to IMDB, Mr. Billing began his movie career in 1982, the same year that Valenti made that speech. Thus, it seems unlikely that Mr. Billing got into acting because he thought that home sales of VHS tapes were going to be where he made his living. It wasn't the case at all in 1982, and as Valenti pointed out, the industry was incorrectly scared that the VHS would kill the movie business. Yet, now, Billing is insisting that the market can't change again and he can't get revenue elsewhere? Why must the market be frozen now when it's adapted so well in the past?

Underbelly Three, for example, could not happen unless the people that produced and invested in Underbelly Two got a return on their investment. Just like any business situation.

Absolutely. But, "just like any business situation," when a market changes, it's up to the producers in that market to adapt their business model to what the market wants -- not to demand legislation that tries to hold back technology and innovation to pretend the world is the way it used to be. Lots of filmmakers are adapting. If Billing is working with those who have chosen not to, he should look for work with smarter producers.

There are lots of ways for films to earn a return on investment. But they need to provide consumers with a reason to buy. Theater showings continue to do that -- and, as we've seen, box office sales have continued to climb at a good clip year after year. DVDs might no longer be a good reason to buy, but the challenge is for the studios to come up with alternatives.

Anyone who illegally downloads a movie or a TV show from the internet is taking money out of the pockets of everyone who was involved in it. And they are making it harder for us to carry on.

Neither statement is even remotely true. What about the person who downloads the movie and then decides to go see the film on the big screen? What about the person who downloads the movie, and loves it so much, he gets a bunch of friends together to go see the film? And, what people choose to do is not making it harder for the industry to carry on. It's the choices the industry is making in not adapting and using new business models.

Sorry, Mr. Billing, but just as when you got started in 1982, the world changes, markets change, and it's time for you and your friends to change to -- not demand that the government pass unworkable laws that try to stop people from doing what they want to do.

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Filed Under: australia, copyright, isps, roy billing, secondary infringement
Companies: iinet

42 Comments

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DH's love child, 12 Feb 2010 @ 9:00am

cue TAM rant in
5....4....3....2...
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Daniel, 12 Feb 2010 @ 9:18am

The next *new*
A good example of a company that has survived the times is Disney. If you look at Disneyland, the park is always changing. it has to in order to keep people interested. Just about everyone wants to see *new*. When there's a new ride (for example, Toy Story in Disneyland had a four hour wait when it opened), everyone wants to go on that ride because it's a new experience. Not only do they have new rides, but they also have different ways for you to enjoy it (annual passes, park hopper tickets, less expensive tickets for just one park for the day). Now they're testing a new World of Color display that will open soon. And that will draw more crowds and give them a reason to keep going back.

In my opinion, the movies have become really boring. Aside from the occasional new movie, the endings are the same, scripts are becoming more and more identical (at least in my point of view). One of the things that made Napster so successful years ago during it's 'questionable' days is that it was *new*. It was the next greatest thing and everyone wanted to be part of the new, the innovative. How many people do you hear about that go into a BestBuy asking for an IBM AT or XT computer? Everyone wants new.

If the movie industry and the music industry don't provide the *new*, their business will slow. It won't go away completely. But business will crawl as will the money. Sharing music with friends unhindered is the next *new* thing in a technological age. The movie companies embraced Technicolor when it came out. They embraced digital in the movie theaters. The movie and record executives MUST LEARN that the customer decides the next *new* thing, not the executives. The executives can only provide that innovation, not dictate what people will accept.
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Michael, 12 Feb 2010 @ 9:20am

I disagree a little
"And they are making it harder for us to carry on"

I actually agree with that statement. Yup - your customers are making it harder for your business model to work because you don't sell what they want. Boo Hoo.

It's amazing how entitled these "artists" sound these days. "I made it, so you have to give me money" does not seem like a viable business model.
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Michael (profile), 12 Feb 2010 @ 9:34am

Those poor actors
What about those poor successful actors of the late 1800s. Along come this device that can record their acting once and suddenly there's no demand for them to ever act that movie again. Surely that destroyed acting as a career. Those poor misguided fools. If only they had lobbied their governments to make the movie camera illegal for ruining their business model.
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NSILMike (profile), 12 Feb 2010 @ 9:43am

How does one know if downloading is unauthorized?
Is streaming equivalent to downloading? If an internet user streams music or video from the growing multitude of sites, how could they make sure it is legal, or authorized?
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Donald (profile), 12 Feb 2010 @ 9:54am

Let's take it to extremes
So, Internet providers are supposed to stop people from sharing or downloading "priated" content?

Shouldn't manufacturers of DVDs put in place technology such that DVDs cannot be copied? If you can't copy a DVD it can't be pirated. This would stop pirates in their tracks.

Shouldn't manufacturers of DVD players put in technology so that only DVDs authorized for your country can be played on your DVD player? This would prevent people from half way around the world from bootlegging the latest movies. This would be sure to cut into pirating.

Shouldn't manufacturers of DVD burning software ensure that whatever is being burned is not copyrighted material? This should be able to stop pirating in its tracks!

Shouldn't manufacturers of new televisions incorporate technology such that they won't display copyrighted material if the source is not an authorized source? This would ensure that people can't watch hi-def bootleg material. This is a guaranteed win.

Let's face it, with all of these technological pieces in place we could wipe out piracy in hours.
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NSILMike (profile), 12 Feb 2010 @ 9:55am

Re: Let's take it to extremes
Donald- I think the jury is in on that... there is no fool proof DRM yet (or in the foreseeable future.)
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Chronno S. Trigger (profile), 12 Feb 2010 @ 10:00am

slightly illogical
"Anyone who illegally downloads a movie or a TV show from the internet is taking money out of the pockets of everyone who was involved in it."

If that was true, then why am I broke? If I'm steeling money from these people's pockets, where is it? With my current tax issues, high heating bills, high electric bills, I could use that money I'm supposedly steeling.

The sad thing is, I could probably solve my money issues by not buying their movies/games/books/whatever and download it all. Damn those people for figuring out my reasons to buy.

(most of that was in jest except for my tendency to buy stuff I can't really afford)
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Dark Helmet (profile), 12 Feb 2010 @ 10:01am

Re: Let's take it to extremes
I certainly hope this was well constructed sarcasm, because your post had me giggling throughout....
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Derek Bredensteiner (profile), 12 Feb 2010 @ 10:01am

Re: Re: Let's take it to extremes
I'm pretty sure that's the joke.
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PaulT (profile), 12 Feb 2010 @ 10:02am

I was pissed at Valenti for that quote for a while, but now it's gold. There's no better way to prove that "change your damn business models" is the appropriate response. The MPAA was purified of the VHS/Betamax back in the day and tried desperately to ban them, withholding their content from release. After having not only accepted, but embraced home content, the movie industry has come to depend on it for long-term profit.

The studios need to learn from their own mistakes, and embrace digital as surely as they embraced VHS and DVD. Fighting the tide and trying to impose last century's model is the thing damaging them.

"What about the person who downloads the movie and then decides to go see the film on the big screen? What about the person who downloads the movie, and loves it so much, he gets a bunch of friends together to go see the film?"

What about the person that the industry is actively refusing to sell the product to in the first place? I say this a lot, but windowing and regionalisation are probably more than 50% of the reason why many people feel justified in downloading in the first place. (excessive pricing, double dipping and censorship probably making up the rest for those who would actually pay anything to begin with).
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Almost Anonymous (profile), 12 Feb 2010 @ 10:02am

I can see why Roy's ticked
"""
What about the person who downloads the movie and then decides to go see the film on the big screen? What about the person who downloads the movie, and loves it so much, he gets a bunch of friends together to go see the film?
"""

But Mike, you are pre-supposing that the theoretically downloaded movies were good, or even decent. This actually brings up a good point: LOTS of moviegoers are sick and tired of buying a pig in a poke.

How many times have you gone to a movie and then come out saying "Jeez, I saw all the best parts in the previews already"...
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NSILMike (profile), 12 Feb 2010 @ 10:04am

Re: Re: Re: Let's take it to extremes
Derek-
OK...then he got me! Sheesh...
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Dark Helmet (profile), 12 Feb 2010 @ 10:11am

Sigh...
"illegally download movies from the internet are jeapordising the future of homegrown Australian TV and films."

Okay, for TV in particular, this makes absolutely zero sense. Here's why:

One of my favorite shows on TV here in the States is Supernatural (and yes, that embarasses me...). I recommended it to several friends, but they couldn't get into it the same way at first because the ongoing storyline really requires that you be familiar with what happened in the majority of the other episodes (for those not familiar, think of it as being similar to the X-Files Canon episodes, otherwise known as the REAL X-Files story).

I found out that a couple of them downloaded the first full season illegally (GASP!), and are now watching the show religiously. Did WB or whoever miss out on the $75 for the season boxset? Sure. But how much more are they making from the additional ad revenue boosted by ratings from these and similar instances?
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Chronno S. Trigger (profile), 12 Feb 2010 @ 10:14am

Re: I can see why Roy's ticked
How many times have you watched a trailer and said "damn, I don't have a clue what that movie's about". Then after watching the movie you say "why the hell didn't they just say that in the trailer?"

I don't like going to a movie that the trailer made sound like a kick ass action movie but find out that it's a sappy love story. Not knocking love stories, probably would have even liked it if it was advertised correctly. Fool me once...
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Dark Helmet (profile), 12 Feb 2010 @ 10:18am

Re: Re: I can see why Roy's ticked
"Fool me once..."

Shame on you....fool me...fool me twice....well....you can't get fooled again!
-George W. Bush, apparently taking over briefly for Roger Daltry to be the frontman for The Who
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yozoo, 12 Feb 2010 @ 10:18am

Who gets free access to the internet?
I believe he is referring to the Richard Stallmen view of free as unfettered and not free as in without charge.
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FormerAC (profile), 12 Feb 2010 @ 10:18am

Dear Movie Industry
I have seen thousands of previews. In the theater and on DVD. I have NEVER purchased a movie based on a preview on a DVD, or a preview in a theater.

I have downloaded a handful of movies from the internet, no more than 15. I have, more than once, downloaded a movie from BitTorrent, realized I was going to watch it more than once, and THEN purchased the DVD.

Do you get it yet?
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drkkgt, 12 Feb 2010 @ 10:25am

lower fees?
In Australia, film and TV budgets are usually low and we actors often take lower fees than normal so a production can be filmed.

So if you "often" take lower fees, wouldn't this make the lower fee the actual normal (ie average) fee?

So are "normal" fees some imaginary number he thinks he deserves rather than what the market pays?
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taoareyou (profile), 12 Feb 2010 @ 10:31am

My Opinion
The movie is not the commodity, it's your experience. When you download a movie, you have not literally "taken" anything from them. You don't have a physical DVD that causes them to be short a DVD. You have instructed your computer to rearrange magnetic patterns on your hard drive, to match a similar pattern on someone else's hard drive.

What you have "stolen" is your experience of the content. Their assumption is that the experience is good enough for you to have been willing to pay for if there was no opportunity to experience it for free.

The problem is there isn't a clear way to prove this.

I think the majority of the reasons people download content without purchasing it is because it's not available in the format and price they want.

For example: I don't like to go to the theater. No matter how long you delay a home release, I'm not going to the theater. I would be willing to watch a new movie" on demand" for say $6. This is for a 24 hour viewing at my leisure.

Once something comes out on DVD, I would be willing to buy a digital copy to own and play whenever I want from my multimedia center. Maybe $10 for recent DVD movies, down to $1 to $5 for older movies.

I would be willing to subscribe to a monthly service for say $10 a month, where I can "buy" movies for $1 each and add them to my "streaming library" so I can watch them whenever I want. (I don't even mind having a "key" like the Netflix CD for the PS3, to ensure that my account is not being shared with multiple households at once).

The point is, I, and I think a large number of people would be willing to pay for content, if that content was priced right (I'm not going to pay retail DVD price for a digital copy of a movie), and available when I want it, and in the format I will most likely use it.

"Piracy" will always exist. But the average person is not downloading stuff because it is free, they are downloading it because either what is offered is overpriced, or what they want is not offered through a legal channel.

Instead of spending millions to stop a loss that is by all means an "imaginary" number, they could be selling and literally be creating new streams of revenue.

Eventually this will happen, and those who refuse to change will go out of business.
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Jeff, 12 Feb 2010 @ 10:40am

compare
He gets all pissy over the fact that iiNet won. They are not responsible for what someone does with the access that is bought from them.

How about we hold gun makers responsible for every murder or robbery.
Why don't we hold auto makers responsible for drunk drivers actions. And then why don't we hold tax payers responsible too, because they provide the roads that drunk drivers use.
Lets hold Microsoft,Apple,Linux responsible for all of this piracy too. Because they provide the OS that are used to illegally download the movies and music.

These people just don't seem to get it. Why is it the responsibility of the ISPs to be the police of the internet? They just provide the connection, that's all!
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MBraedley (profile), 12 Feb 2010 @ 10:47am

Just to play devils advocate, WRT your comment after the first quote, "Free access to the internet" could be construed as Free (as in speech) access and not Free (as in beer) access. The former is how I initially read it.
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Chronno S. Trigger (profile), 12 Feb 2010 @ 10:54am

Re:
In this context, it's perfectly reasonable for people to mistake the "free internet" remark to mean "free as in beer". Since pretty much everything else he bitches about is money oriented, it would seem to follow the same path.

While "free as in speech" douse fit better, he could have chosen another word to get his point across properly, like "unmonitored", "unrestricted", "unfiltered", "open".
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Dave (profile), 12 Feb 2010 @ 10:55am

Re: Sigh...
I couldnt agree more with this. I have downloaded very few TV shows. Those that I have are when I fell a few weeks behind on a show and Hulu got rid of the content. If I could have watched it through some legit channel, I would have. When I was left with no choice, except maybe simply not watching it, I took the unauthorized route.

The other choice, which I almost opted for, was simply never watching the show again because I had missed an episode. Is that really what the producers want?

I have purchased a few seasons of shows on DVD in the past, but I just hate having DVDs around these days. If I could get back episodes streamed for free (or even cheap) I would do it. If they dont offer it to me, I will find the content through some other means. Especially since it is just so damn easy to find these days!
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Anonymous Coward, 12 Feb 2010 @ 11:22am

This is the biggest pile of shit I've ever seen. I don't think you actually made any points Masnick. And if you did, they were all based on assumptions and exceptions.
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Dark Helmet (profile), 12 Feb 2010 @ 11:45am

Re:
"This is the biggest pile of shit I've ever seen. I don't think you actually made any points Masnick. And if you did, they were all based on assumptions and exceptions."

I DON'T KNOW WHAT WE'RE YELLING ABOUT!!!

LOUD NOISES!!!!
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Anonymous Coward, 12 Feb 2010 @ 11:48am

Re: compare
What if you held movie producers responsible for what happened in each theater that thier movie was showing.
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Richard (profile), 12 Feb 2010 @ 11:57am

Re: Let's take it to extremes
Aaaargh - don't give them ideas....
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NAMELESS.ONE, 12 Feb 2010 @ 11:57am

USA pay for an actor a day
400 MIN and thats a low end say do nothing stand there person
speak and do stuff important and its 4000 a day

anyone here make 4000 a day for pretending and speaking
hrm time to see about capping those to reasonable amounts id rather see more money goto um i dunno firemen , doctors and such. MAYBE to help create jobs for unemployed or expand health care.

maybe we should also visit the legality of charging 17.07 for a large pop and bin a popcorn?

maybe we should have the cops raid the CRIA offices and see where the 450 million in cdr levy money went?

maybe we should have some charges laid for counterfeiting commercial against the CRIA for not paying musicans under contract for there rights, and fine them 20000 PER INFRINGEMENT? yea thats the law here in canada and BOY YOU QUIET INDUSTRY NOW THAT YOUR ON THE OTHER END OF IT.
seriousl jail terms also for htose that dont pay fines with a max of one day in jail per 10$ you dont pay....

enjoy you scum bags
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NAMELESS.ONE, 12 Feb 2010 @ 11:59am

OH YA i forgot the cops are all at the olympics
ya they sent 16 cops form peterborough ontario canada alone instead of regular peterborough people.
GUESS there's 16 cops we dont need ot be paying so enjoy the games when you get back
as donald trump would say

YOUR FIRED...oh wait redact that hes got it trademarked
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RD, 12 Feb 2010 @ 12:02pm

Re: Re:
"While "free as in speech" douse fit better, he could have chosen another word to get his point across properly, like "unmonitored", "unrestricted", "unfiltered", "open"."

Chrono, please, for the love of Mike, use "does" there. "Douse" means to dunk or soak with water, like you would douse someone with a bucket of water. :)
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Chronno S. Trigger (profile), 12 Feb 2010 @ 12:29pm

Re: USA pay for an actor a day
I have to ask, are you running this threw a translator? The way this reads, it reminds me of a German document I ran threw Bablefish. You do have a good point, it's just hard to read.
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Chronno S. Trigger (profile), 12 Feb 2010 @ 12:40pm

Re: Re: Re:
Forgive me. The part of my brain that stores the spelling of a word is kinda screwed up, has been since birth (for example, even though I Googled it, I'm not sure "stores" is correct).
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Paul`, 12 Feb 2010 @ 1:36pm

As far as I know both Underbelly one and two were available on the internet the day the episode aired: just like usual. Their DVD sales were excellent, I work in retail and our store sold dozens of copies the day it came out.

This guy is a douche with no real grasp of the issue he is writing about.
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Richard (profile), 12 Feb 2010 @ 1:37pm

Re: How does one know if downloading is unauthorized?
If an internet user streams music or video from the growing multitude of sites, how could they make sure it is
legal, or authorized?
There is no way for them to be sure. Even a major content owner might not actually have the rights to everything they offer.

For this reason it is highly unlikely that anybody would ever be successfully prosecuted just for downloading. It is uploading (making available) that the content owners usually pursue. (and all the major cases you have heard about involved "making available").

However you need to bear in mind that even in the default setting some P2P systems will automatically re-upload everything they download.
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:), 12 Feb 2010 @ 1:46pm

Re:
Abel LeBlanc - You are a punk!

You read just like Abel LeBlanc sounds LoL
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AR, 12 Feb 2010 @ 2:10pm

I can fix it
I know. Do what do other businesses do when the employees complain about pay cuts. OUTSOURCE! He's from Australia, the "cheap labor" countries are real close. Maybe when his "normal fees" equal the "normal" minimum wage he might shut his mouth and be thankful for what he is getting.
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Anthony, 12 Feb 2010 @ 5:14pm

I woulg glady pay for good quality DRM digital copies of movies and TV shows in an open format(H.264 or divx/xvid) - Ones that are just the movie, none of that copyright crap at the start. But there's none available. If I buy a DVD I'm forced to watch an unskipable 1-2 minute video telling me not to copy this DVD everytime I put the DVD in. It really annoys me, and certainly doesn't encourage me to buy DVDs.
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taoareyou (profile), 12 Feb 2010 @ 6:49pm

Re:
"...I don't think..."

I agree.
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TechNoFear (profile), 12 Feb 2010 @ 9:32pm

Two missing 'facts'...
The Australian film industry got nearly Au$230 million in taxpayer funding last 2008/2009. [eg ~Au$10 per Australian man, woman and child.]

Australian commercial TV is allowed 18 minutes of adverts / hour ( + promos, overlay ads, sponsor messages, etc).[Underbelly was a TV release only.]
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Hephaestus (profile), 12 Feb 2010 @ 10:03pm

Re: Those poor actors
Lets not forget the poor pop corm farmers ..
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NSILMike (profile), 16 Feb 2010 @ 11:45am

Re: Re: How does one know if downloading is unauthorized?
Yes, obviously I agree it's difficult to know... I just wonder how secure one can be in the assumption that one is unlikely to by prosecuted (successfully or not!) for downloading and/or streaming. And, whether the law makes any distinction between streaming and downloading- in one case the file may be permanently loaded onto your PC, in the other it may be only temporary...but that seems like a slim legal difference. P2P sites are not interesting to me, so I am not worried about inadvertent sharing. I am interested in using Lala, Last.FM and many potential competitors...
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