ISPs in 2010 - iiNet

iiNet's MD, Michael Malone, on what the industry can expect in 2010

How do you see the telecommunications legislative landscape changing in 2010?

This is an area where the opposition really needs to get out of the way and let smart enabling legislation pass through the Senate. The current regime just isn’t delivering a good result for consumers. We need a better regulatory framework, with clarity on pricing and rules as we transition to the NBN.

Of course, the main debate is about structural separation of Telstra and the rollout timeframe for the NBN, which are really the exact same question. Again, hopefully we’ll have a real idea of what the future looks like within the next year.

What do you view the potential impact of the AFACT/iiNet case to be in 2010 whichever way it goes?

We are confident that our defence has been very strong and that iiNet will completely cleared of authorising “…the infringing acts of the users of its facilities.” The legislation and relevant case law are on our side.

In the unlikely event that the case isn’t resolved in our favour, the potential for a massive penalty looks to be very low, with recent Australian copyright cases resulting in damages at a level that would hurt, but certainly not put us out of business. I don’t think that’s the objective of the rights holders anyway: They want ISPs alive and healthy to do the work. Thus we don’t expect any major impact on iiNet as a business.

That’s all academic, because of course we’re going to win! So when AFACT lose, and the inevitable appeals are exhausted, it is likely that the rights holders will lobby for legislative change anyway to implement what they call “graduated response”. This is a global push, not just being called for here in Australia. What they want is for warnings to be sent to customers, and then customers cut off, without any judicial review, and with ISPs picking up the bill. The EU has ruled that this is inappropriate, and I’m sure that Australia will as well.

What impact do you see the Federal Government’s proposed mandatory ISP-level filter having in 2010?

Unfortunately, the ill conceived ISP level filtering will probably get up in 2010. It won’t achieve anything at all, it certainly won’t stop the sickos from getting access to material that is illegal, and it won’t protect the children. But the Government can say that they tried, get the photo opportunity and tick that box before the election.

At least we’re now seeing that debate about the safeguards on the block list. These things are not present today, which is why we have spoken against the 2009 trial. I’m very happy to see Senator Conroy suggesting that we will have a clear policy, good processes and transparency, and with that in place we could very well be supportive. Dentists, tuck shops and political material will still get targeted, but at least they’ll know about it and have a chance to get off.

Still, however well intentioned and structured, it won’t work. Dumbest. Idea. Ever.

How will Internet piracy affect ISPs in 2010?

Internet piracy is bad for ISPs as well as rights holders, but litigation won’t hold the technology back, even if we wished it so. The first thing that the rights holders need to do is get their content available online promptly and at realistic prices. The rapidly increasing usage of iiNet’s Freezone and industry wide investment in content and set top box technology shows that there is another way. Copyright owners have a right to be paid for their work. We’re here and keen to help!

It’s possible that there will be a more structured policing policy put in place at some stage next year. We kind of like the Swedish model, which has seen a short form process for rights holders to send warnings directly to customers, with judicial review. If we can get the legitimate options in place, then responsibility should be placed on the individual user if they continue to take illegal options.

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