iiNet’s Hollywood ending: what does
its court victory mean for copyright law?


This article is by Nicolas Suzor, a Lecturer in the Faculty of Law at the Queensland University of Technology. It was first published on The Conversation and is re-published here with permission.

analysis In what is being billed as iiNet versus Hollywood, the Australian internet service provider has come out an apparent winner after the High Court dismissed a copyright infringement case brought by industry movie studios. The case was a final appeal by the industry in its attempts to crack down on internet users infringing copyright by using BitTorrent to download movies. Nicolas Suzor, lecturer, Faculty of Law at Queensland University of Technology, explains the decision and what it means.

What’s the background to today’s decision?

This decision is the culmination of the last few years of litigation by the Australian Federation against Copyright Theft (AFACT), in conjunction with 34 movie studios. They sought to argue that iiNet, which is Australia’s second largest internet service provider, was liable for copyright infringement when its users used their home internet connections to download and upload movies using the BitTorrent protocol.

The High Court has found in line with the lower level court decisions that iiNet was not responsible for the actions of its users. The evidence before the court was that iiNet hadn’t done anything beyond providing the internet connection. The High Court found in order to be liable something more is required – iiNet cannot be liable for merely being inactive in response to allegations of infringement of copyright made by AFACT. Importantly, the High Court ruled that it would not be reasonable to expect iiNet to disconnect the accounts of its users solely on the allegations of infringement provided by AFACT.

What are the implications of this decision? Other internet service providers will no doubt be watching with great interest.

It’s a very important decision worldwide. We’ve only seen a few of these decisions so far. There was one in the Irish High courts where the Irish ISP Eircom was found liable for infringement on its network.

This decision in Australia is the most considered decision that we have seen in common law countries. It represents the next iteration of an attempt by copyright owners to enlist the aid of internet service providers to police infringement on the internet.

Over the past 15 years, copyright owners have had trouble using litigation to deter copyright infringement. They started off targeting companies like Napster and Kazaa, who were clearly encouraging the infringement of copyright by developing peer-to-peer file sharing networks that were designed to allow people to share copyrighted materials.

Then those technologies started to become decentralised and the copyright owners found they could not sue the developers of technologies like BitTorrent because they are such widely used general-purpose protocols, and they couldn’t sue end users because it tends to be terribly expensive, terribly unpopular, unfair and, realistically, quite ineffective.

So most recently, they have been trying to impose a duty on domestic ISPs to police infringement on the network. This approach is attractive because ISPs are quite big targets and, by imposing regulation at that point, they can potentially have quite a strong flow-on effect on the ability to control what users are actually doing.

This is quite an important decision worldwide because a lot of different countries are trying to look for different ways to target infringement and trying to sort out the principles on which ISPs should and should not be required to police what is on their network.

France had a quite controversial three strikes regime, which was struck down by the Constitutional Court and, in the end, was recast as a more limited and legitimate judicial regime. Both the UK and NZ have also introduced controversial “graduated response” regimes, where users will be progressively warned and potentially have their internet accounts terminated when they are found to have infringed copyright. The US has not gone so far, but the major ISPs have agreed with copyright owners to introduce some form of private notification scheme.

What about here in Australia?

Here in Australia this was seen as a test case to see if ISPs already have a duty to police Australian internet users under the law. It was quite ambitious in that the duty to terminate is not explicit under Australian law. The questions was whether or not ISPs that did nothing more than provide a connection could be liable. If they were, that would impose on them an obligation to do something about copyright infringement – although AFACT was never quite clear on what exactly it expected ISPs to do.

So what will the next move be from copyright owners?

I think two things may happen. This decision provides a good deal of certainty to Australian ISPs under current law, so copyright owners will likely increase pressure on policy makers to develop a new legislative regime. Copyright owners are still looking for a way that they can enlist the help of intermediaries such as ISPs to police copyright infringements, although such regimes are often highly controversial. It is unclear at this stage whether the federal government will entertain copyright industry demands for a three-strikes or similar system in Australia, particularly in the face of strong public opposition worldwide. At any rate, little is expected to change before the Australian Law Reform Commission completes its review of the copyright system near the end of 2013.

We are also starting see the emergence of an acknowledgement by copyright owners that it is important to develop business models which provide consumers with cheap, high quality and fast access to entertainment and other copyright material. The one thing that has worked in last 15 years is increasing access: models like iTunes, Amazon’s Kindle, and Netflix have been able to successfully provide a legitimate and convenient alternative to infringing filesharing.

This article was originally published at The Conversation. Read the original article.


  1. To bad that copyright holders do not want my money case in point Game of Thrones there is no reason why we have to wait over a week to see it here None at all in fact if it was shown on foxtel within a day then I would pay the extra money to get showcase pretty much just for that BUT no they would rather not make money.

    • I agree. Although even taking it a step further, I dont want to pay for Austar either (no Foxtel in my area) when I have zero interest in most of the channels and shows on offer. Plus the picture quality is “ok” at best, given the relatively low bit-rate.

      What I’m hanging for is a subscription based HD IP service like Hulu, so I can choose to watch only the shows I want to watch, when I want to watch them, in 1080p/5.1

      As for Game of Thrones, given its the most awesome show I’ve ever seen, I will continue to download it in 720p with 5.1 sound, until I have a legal way of obtaining it in line with the US, that doesn’t cost the earth or require me to sign up for payTV.

    • As long as Foxtel is able to charge people $100/month for mostly recycled garbage programming, they will continue to be the biggest stumbling block to change in the local market. They want to protect their business, of course, but more importantly, Hollywood wants to maintain the outrageous cumulative prices it commands through drip-feed regional distribution. The problem wouldn’t be so pronounced if it weren’t for their monopoly position and the financial interest Telstra and Newscorp have in its survival.

  2. To be honest, There’s always a way to change.

    This is what the Movie/TV industries need to do, and follow in the footsteps of the music industry

    1) Allow the consumer to view the product on any device of their choice.
    This means ANY device reasonably capable pf displaying videos. This can be a smartphone, right through to a bleeding edge computer, through to your TV/DVD player. This can be achieved by the studios working together and having a single storefront that can be accessed from any device. Videos purchased could then be account locked, rather than device locked.

    2) Bring down the cost of the video.
    I can sort of understand some of the costs involved in physical distribution, but is there any reason why a digital file costs more here in Aus than it does in America? I would suggest that by bringing the costs down, especially for TV Seasons, then people will be less inclined to pirate them. My suggestion is $10 for DVD quality seasons, and $20 for Full HD seasons.

    3) Allow the Digital Download close to the same time as the original airing.
    One of the reasons I’ve noted is that people will often download a TV show because it will take 6 or more months to get here, and even then there’s no guarantee of it being shown in the correct viewing order. By allowing the download to happen at the same time as the premiere, or even just after, it removes one of the biggest reasons for pirating, because the content is available to watch when the consumer wants to watch it, not when the TV Station locally airs it.

    4) NO Subscription payment methods.
    I touched on cost in #2, but this deserves it’s own number. The purchase should be done once, and not be made a “Subscription” model. Even if they did the points listed above, but made it a subscription payment for seasons, and not a once off payment, then people will still pirate it to reduce that.

    There is an exception to this though, and that’s streaming video. If you elect to view the content via streaming video, then the Subscription should cover reasonable costs.

    These are just ideas I came up with off the top of my head. Please feel free to suggest different ideas though!

  3. Sorry, but while most of this article is useful and informative the last paragraph overstates, I suggest, the willingness of content owners to engage with new technology.

    Content owners continue to try to channel content distribution in the manner that is best for them, without considering the consumer. I read an article recently, talking about a tour by one of the larger film company presidents to a number of college campuses after the failure of SOPA in the US. He totally failed to acknowledge why people might object to the bill, and how his company and others might change how they do business. Without recognising a problem there is no solution.

  4. For 16 years Hollywood has been stealing money (pirating) from Australian consumers through their geographical market segmentation price-fixing scheme; region coding. Until they admit to that theft, and accept that their punishment has been copyright infringement – until then we will advocate and promote even tougher retaliation measures. Time for treading softly is long gone… we’ve been bent over a barrel with our strides down for 16 years FFS!

  5. For 16 years Hollywood has been stealing money (pirating) from Australian consumers through their geographical market segmentation price-fixing scheme; region coding. Until they admit to that theft, and accept that their punishment has been copyright infringement – until then we will advocate and promote even tougher retaliation measures. The time for treading softly is long gone… we’ve been bent over a barrel with our strides down for 16 years FFS!

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