• Opinion Editorial I wrote for the Australian Financial Review titled: NBN is an opportunity and a threat to Australia’s creative and content industries (Thursday, 22nd September 2011)
  • If youíve hired or bought a DVD lately, youíll know that almost every movie starts with a warning against downloading pirated content from the Internet.

    Regrettably, this illegal practice is rife in Australia and is conservatively estimated to cost the TV and film industry more than $250 million in lost revenue every year.

    But while itís bad now, imagine what itís going to be like when Australians have access to the hyper fast National Broadband Network: illegal movie downloads will take just seconds rather than hours.

    What is at stake is the industryís $6.1 billion contribution to the Australian economy, employing 50,000 Australians.

    Australia’s third largest Internet Service Provider, iiNet, admitted in Court the majority of internet traffic on its network involves peer to peer file transfers, and we know that 80 per cent of this activity involves pirated movies and other copyrighted content.

    The looming piracy threat was the topic of a leaked diplomatic cable from the US Ambassador to Australia who said “the problem will persist and probably worsen with the advent of the high-speed National Broadband Network, as the speeds at which copyright theft can take place will literally multiply.”

    It is a challenge the Federal Government is thankfully keen to address with a roundtable meeting tomorrow between major Internet Service Providers, such as Telstra, Optus and iiNet, and content owners.

    Recent comments from ISPs demonstrate an understanding that they must be part of the solution, as their businesses now rely on exclusive content to maintain subscribers rather than a pure commoditised internet access play.

    The Intellectual Property Awareness Foundation (IPAF) released data this month showing that 72 per cent of consumers say they would stop illegal downloading if they received an educational notice from their ISP and people in fact believed ISPs were encouraging such behaviour.

    In other words, ISPs are key to solving the online piracy problem.

    The Federal Government has said the NBN will lead to major changes in the way Australians access and enjoy their entertainment so to spend $35 billion building high speed infrastructure, and to be aware that there is irrefutable evidence that internet piracy is rife, means they also have a role in ensuring online and off-line copyright protections are robust.

    Canberra cites South Korea as a model for the National Broadband Network. However, we are also aware that South Korea’s NBN decimated their domestic film and TV industry as the country went on an illegal downloading frenzy.

    Once the size of the problem was realised the South Korean Government implemented a graduated response policy starting with educational notices to ISP customers involved in piracy to protect creative and content industries.

    This led to the resurgence of the South Korean film and television industry, with local telecommunications companies becoming investors and creators of exclusive content.

    Rather than unscrambling the omelette like the South Koreans were forced to do, we have the chance to get ahead of the game before the NBN becomes fully implemented.

    The UK, France, South Korea, New Zealand, Ireland and Taiwan have all introduced schemes aimed at removing infringing content on peer to peer networks without the sky falling in.
    And in July this year, the United States’ leading ISPs and content industries reached a landmark agreement to deal with this issue based on a series of notices sent by ISPs to its customers identified as engaged in infringing behaviour.
    Copyright is the basis by which our societies have rewarded and promoted invention and creativity for the past 300 years.  

    The creative industries, and the TV and movie industry in particular, have embraced new online business models.

    However, it is hard for any business model to compete against something that is pirated or “free”.

    This lack of protection has economic consequences. We need to ensure that people are rewarded for their inventiveness and creative efforts so that people can have that economic certainty.

    Failing to do so undermines the social and technological development this country has enjoyed.

    We should learn from South Korea and many others to ensure that Australia enjoys what the Government calls the Digital Dividend, by promoting the adoption of a notices scheme to reduce internet piracy in advance of the NBN being rolled out further.

    Simon Bush – CEO Australian Home Entertainment Distributors Association