As Internet users demand more freedom online alongside an ability to consume media in a manner of their choosing, tools allowing them to do so are gaining in popularity.
Notable has been the rise of VPN services, which not only provide an increased level of privacy but also allow users to appear in any country they choose. This opens up a whole new world of content availability – such as better service from Netflix – often at better prices than those offered on home turf.
While popular with consumers, this behavior is frowned upon by distribution companies that spend huge sums of money on content licensing deals specific to their regions of coverage. Losing customers to overseas providers isn’t part of their plan and now some are doing something about it.
Earlier this month media companies SKY, TVNZ, Lightbox and MediaWorks told several Kiwi ISPs that if they don’t stop providing VPN services to their subscribers, legal trouble would be on the horizon.
Within days one of their targets, Unlimited Internet, pulled its VPN service after receiving a letter from a lawfirm claiming breaches of the Copyright Act. However, CallPlus and Bypass Network Services have no intention of caving in to the media giants’ demands.
“To receive without warning a grossly threatening legal letter like that from four of the largest companies in New Zealand is not something we are used to,” wrote Bypass CEO Patrick Jordan-Smith in a letter to the media companies.
“It smacks of bullying to be honest, especially since your letter doesn’t actually say why you think we are breaching copyright.”
Pulling no punches and describing his adversaries as a “gang”, Jordan-Smith likens the threats to those employed by copyright trolls in the United States.
“Your letter gets pretty close to the speculative invoicing type letters that lawyers for copyright owners sometimes send in the US ‘pay up or shutdown or else were are going to sue you’! Not fair,” he writes.
“We have been providing the Global Mode facility for 2 years. In all that time, none of your Big Media Gang have ever written to us. We assumed they were OK with Global Mode and we continued to spend money innovating the facility and providing innovative NZ ISPs with a service that their customers were telling them they wanted – a service that lets people pay for content rather than pirate it.”
The response from Bypass hasn’t been well received by the media companies who now say they will carry through with their threats to sue over breaches of copyright.
“Our position has not changed and unless they remove the unlawful service we will begin court action in the next few days,” says TVNZ chief executive, Kevin Kenrick.
“Each of our businesses invests significant sums of money into the rights to screen content sourced legitimately from the creators and owners of that copyrighted material. This is being undermined by the companies who profit from promoting illegitimate ways to access that content.”
Claiming that the action is aimed at defending the value of content rights in the digital world, Kenrick says that the legal action is not consumer focused.
“This is not about taking action against individual consumers or restricting choice, indeed each of our businesses are investing heavily in more choice so New Zealanders can have legitimate access to the latest TV shows and movies,” the CEO concludes.
While the commercial position of the TVNZ chief is understandable, his claim that this legal action isn’t aimed at reducing choice simply doesn’t stack up. Kiwis using Netflix locally get access to around 220 TV series and 900 movies, while those using a VPN to tunnel into the United States enjoy around 940 TV series and 6,170 movies, something which Bypass Networks believes is completely legal.
“[We provide our service] on our understanding that geo-unblocking to allow people to digitally import content purchased overseas is perfectly legal. If you say it is not, then we are going to need a lot more detail from you to understand why,” Jordan-Smith informs his adversaries.
“Simply sending us a threatening letter, as frightening as that may be, does not get us there and is not a fair reason for us to shut down our whole business.”
While VPN services have always been associated with privacy, in recent years they have bloomed into tools providing much more than a simple way to stay cloaked online.
For a relatively small fee, users of the most popular VPN services can tunnel out of their country of origin and reappear in any one of dozens of countries around the world. This opens up a whole new world of media consumption opportunities.
Citizens of the United States, for example, can access BBC iPlayer just like any other Brit might, while those in the UK looking to sample the widest possible Netflix offering can easily tunnel right back into the U.S.
This cross-border content consumption is not popular with entertainment companies and distributors. It not only undermines their ability to set prices on a per-region basis, but also drives a truck through hard-negotiated licensing agreements.
Tired of dealing with ISPs including Slingshot who offer a dedicated ‘global mode‘ VPN service for customers, last week media companies in New Zealand ran out of patience.
“We pay considerable amounts of money for content rights, particularly exclusive content rights. These rights are being knowingly and illegally impinged, which is a significant issue that may ultimately need to be resolved in court in order to provide future clarity for all parties involved,” Lightbox, MediaWorks, SKY, and TVNZ said in a joint statement.
“This is not about taking action against consumers; this is a business-to-business issue and is about creating a fair playing field.”
Before being granted limited local access to Netflix just last month, Kiwis were required to level their own playing fields by paying for a VPN service and an account at an overseas supplier in order to legally obtain a decent range of premium content. However, the media companies now want to bring an end to that free choice via legal action. Today they claimed their first scalp.
This morning Unlimited Internet became the first ISP to respond to media company pressure by pulling its geo-unblocking service known as “TV VPN” after receiving a warning letter from a lawfirm.
The letter, which has been sent out to several local ISPs, informs Unlimited Internet that its VPN service infringes the Copyright Act of 1994.
Unlimited Internet director Ben Simpson says that while his company doesn’t necessarily agree with that assertion, it has taken down the service nonetheless.
“Geo-unblocking services are a direct result of consumer demand for access to content that is not made available to the New Zealand market,” Simpson says.
“To be on the safe side, we have taken legal advice on this matter and I have made a firm call that we will sit on the sideline until a legal precedent has been set.”