Football codes such as the AFL and the NRL could be out of pocket by tens of millions of dollars in broadcast rights fees after a Federal Court judge ruled today that the Optus Now service that delivers football matches minutes after they have gone to air on free to air TV is legal.The ruling is a blow to Telstra who has forked out million in rights for exclusive sport content.
The ruling is also damaging for the Australian Football League’s recent broadcast rights deal, the upcoming NRL broadcast rights negotiations as well V8 racing of which Telstra is a major sponsor.
Justice Steven Rares of the Federal Court in Sydney ruled earlier today that Optus is protected from copyright claims by the AFL, Telstra and National Rugby League, when they broadcast content via their TV Now Service.
Lawyers for Optus argued successfully that the TV Now service was like a modern day recorder in that it allowed subscribers to the Optus service to access their football content from a stored location in the cloud whenever they wanted to access it.
Justice Rare’s decision was based on time-shifting provisions in the Copyright Act, which allow individuals to record and watch a show at a more convenient time. Justice Rares found that, when Optus customers “clicked” on record, they were programming a recording for their individual use. Therefore Optus was not re-broadcasting copyrighted material to the public.
“I found that such a recording or film was made by the user to watch it at a time he or she considered to be more convenient than when the live broadcast occurred, even if only by minutes.
“I decided that Optus’ TV Now service did not infringe copyright in the broadcasts of the AFL and NRL games in the particular ways that the right holders alleged,” he said.
He also found that it was the user, rather than Optus, who was then responsible for electronically transmitting the recording, or making it available online, by clicking the “play” button.
However, Justice Rares said some issues might still need to be resolved, including whether Optus infringed copyright with the particular technology it used to make a recording in a format suitable for Apple devices.
Before the decision Telstra had warned that an adverse decision could scuttle its $153 million exclusive deal with the AFL.
Both Telstra along with several sporting bodies are expected to appeal the judgement in a move that will allow Optus to deliver this year’s NRL and AFL games as the appeal could take up to six months to be heard.