A tale of two NBNs: the Coalition's broadband policy explained

By Karl Schaffarczyk, University of Canberra

Today in Australia, the Coalition released its policy on the National Broadband Network (NBN). So what is the proposal?

Amid rhetoric claiming Labor government inefficiency, cost blowouts and failure to meet roll-out targets, the Opposition leader Tony Abbott and shadow communications minister Malcolm Turnbull unveiled the detail of the efficient, value-for-money NBN we should expect under a Coalition government.

The plan calls for the existing NBN rollout to stop, and be restarted using Fibre to the Node (FTTN) technology. FTTN involves delivering optical fibre to a shared “cabinet”, which in turn provides internet access to customers within one kilometre – necessitating the placement of many cabinets throughout suburbs and towns.

This differs from the existing plan for the NBN, as supported by the Labor government, which will deliver Fibre to the Home, or FTTH.

Household equipment in a typical FTTH NBN installation. Alan Kerlin

FTTH, as the name suggests, involves installing optical fibre directly to houses, apartment buildings and businesses to provide high‐speed internet access. The fibre goes to what’s known as a fibre access node (FAN) – comparable to a telephone exchange – which can service many suburbs.

The Coalition’s plan flies in the face of advice the Australian Competiton and Consumer Commission (ACCC) gave the government in 2006.

The advice highlighted the high costs of installing nodes, and described an FTTN network as:

not so much a stepping stone towards a future FTTH network as a distinct network alternative.

Labor’s vision

To better understand what the Coalition is offering, we should understand the NBN being rolled out today:

Lukas Coch/EPA

The NBN is designed to deliver high-speed broadband Australia-wide using three delivery methods:

• Fibre to the Home
• fixed wireless
• satellite

Fixed wireless and satellite are uncontroversial – both sides of politics support these key technologies in regional and remote areas.

FTTH vs FTTN

Fibre to the Home is planned for 93% of Australian households.

To do this, the NBN uses an implementation called Gigabit Passive Optical Network (GPON) – the main advantage of which being that it operates without any powered equipment between a house and the fibre access node.

That means greater reliability due to fewer points of failure, and lower running costs due to lower electricity consumption, fewer deployed electronics, and so on.

Passive fibre networks are cost-efficient by sharing a single fibre across 32 homes. Mathew McBride

Speeds offered to each customer under the existing NBN plan are potentially as high as 1,000Mb/s – around 500 times faster than most Australian broadband users utilise currently – but an expectation of between a quarter and a half of those speeds is more realistic.

Presently the NBN offers speeds of up to 100Mb/s.

The main drawback of a FTTH system is the reliance on fibre optic cables. The cables must be drawn through existing conduit, or laid in new trenches to each house in the coverage area.

The labour costs of doing this are huge and increase the total cost of rolling out the network by double or triple when compared to a cheaper FTTN network.

Passive optical network implementations similar to GPON have a proven track-record in countries such as South Korea and Japan – where access to high-speed broadband has been taken for granted for years.

The Coalition’s vision

The Fibre to the Node system promoted by the Coalition does have several advantages.

The installation of the network will be significantly quicker – the Coalition claims their NBN will reach most Australians by the end of their first term in 2016, compared to the current estimated completion date of 2021 – as FTTN networks re-task existing copper phone lines.

Technologies such as very-high-bitrate digital subscriber line (VDSL) and asymmetric digital subscriber line (ADSL) will be used to deliver data to customers' home.

In short, because existing phone lines are used, significant capital costs are avoided because there is no need to lay fibre to every household.

Fibre to the Node explained.

Using VDSL, theoretical speeds of up to 200Mb/s are achievable (under perfect conditions) – but it has been pointed out these speeds rapidly drop off as the houses become more distant from the node.

One kilometre drops the speeds to a very ADSL2-like 30Mb/s, and two kilometres from the node provides no advantage over sticking with ADSL2, which many people will currently be using.

Copper

The biggest issue with a FTTN version of the NBN is not if it can be done, but how consistent, and how reliable, this network can be. It has been claimed by some that Telstra’s copper network is “rooted”; although Telstra has hit back, claiming approximately 1% of all services experience a fault each year.

wormwould

Responding to this concern, Mr Turnbull announced that mouldering copper would be dealt with on a business-case basis – either the copper would be repaired, or replaced with fibre.

Today’s announcement also devoted some time to discussing how technology always progresses, and so copper can be pushed to carry more data as improvements are made.

Vectoring was specifically mentioned – a technology that continually fine-tunes the connection between the end-user and the network, and allows significant improvement in speeds.

But critics have pointed out that vectoring may still be years away.

Costs of maintaining FTTN

While the Coalition’s policy today focused on the installation cost of a FTTN network, claiming savings of billions of dollars, little acknowledgement has been given to the cost of maintaining a FTTN network.

According to the ACCC, up to 90% of the costs of running a FTTN network relate to maintaining the nodes.

In the US, the broadband and telecommunications company Verizon cited significant savings of US$110 for each household on fibre compared to copper.

Comparing the policies

The costs of rolling out FTTN then upgrading to FTTH is prohibitive.

FttH. dvanzuijlekom

The Labor party policy of deploying the NBN as FTTH can be summarised as having an initially painful installation cost, but offering a more consistent outcome with greater spare capacity to meet future needs.

By comparison, the Coalition policy can be described as quick and dirty: the network will be available to more Australians earlier, and will cost less up-front, but will attract ongoing maintenance costs, and be expensive to upgrade as demand grows.

Karl Schaffarczyk lives in a Canberra suburb where the NBN is due commence construction within one year.

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

Smacking down online piracy – does New Zealand know best?

By Karl Schaffarczyk, University of Canberra
We know online piracy exists; we know governments want to stop it – but what are the options?
Richard Freudenstein, CEO of Australia’s largest pay-TV provider Foxtel, has joined the chorus of entertainment industry bodies to call on the government and internet service providers (ISPs) to clamp down on online piracy.
During his speech to the 2013 ASTRA conference last week, Freudenstein demanded that a new anti-piracy enforcement regime be delivered before the National Broadband Network (NBN) is rolled out “because with super-fast broadband the floodgates could really open”.
Freudenstein’s belief that Foxtel’s business model would be under threat from the NBN is scarily similar to the recent wailing and teeth gnashing of the music industry: the faster internet speeds the NBN will bring will lead to dramatic increases in the illegal downloading of TV shows.
Peak music industry bodies claimed the NBN would be a “disaster” for copyright infringement in a recent report.
So, what’s to be done?

Kiwi solution: the one we nearly had to have

In Australia, talks have been held in recent years between content owners and ISPs, with the aim of agreeing on a “graduated” copyright warning and enforcement system – that is, a system in which users who breach copyright are sent a series of warning notifications.

Search Engine People Blog

Repeat offenders under this type of system risk punishments such as bandwidth reduction and possible temporary account suspension.
Talks were again held by former attorney-general Robert McClelland during 2011/12, but fell apart after the major ISP iiNet withdrew from the talks, citing concerns that the entertainment industry was only attempting to force ISPs to act as the police to enforce a broken system – one which fails to meet the demands of consumers.
Freudenstein named New Zealand in his speech among a number of nations who have a co-operative enforcement systems between ISPs and content owners.
So what does New Zealand’s co-operative system look like? And could it work here in Australia?

Three strikes

New Zealand operates under a three-strikes system. Introduced in 2011, the requirements of the Copyright (Infringing File Sharing) Amendment Act oblige ISPs to issue infringement notices to internet account holders when content owners (rights holders) allege file-sharing activity by the end users of that ISP.
The scheme is structured as “guilty until proven innocent”. A rights holder’s allegation is considered to be sufficient evidence of infringement, unless the account holder can disprove the claim.
No matter who carried out the infringing behaviour, account holders are held solely responsible for infringements. Issues relating to children using their parents accounts, neighbours stealing Wi-Fi, and small businesses providing internet hotspots have been raised by media and in blogs.
The “strikes” are as follows:
1) The first infringement notice issued by an ISP to an account holder is called a detection notice. That notice must spell out the details of alleged infringement, warn the account holder of the consequences of continued infringing behaviour (such as file-sharing), and explain how the notice may be challenged.
The infringement notices must be sent to the account holder by the same method in which bills are delivered (i.e. online or in posted paper form).
2) If the file-sharing activity continues beyond 28 days from the date of the detection notice, the ISP is then obliged to issue a warning notice. The requirements of this notice are similar to the detection notice, and it must also make reference to earlier notice, and warn of the consequences of continued file-sharing.
3) An enforcement notice is then issued where rights holders allege file-sharing activity has continued beyond a further 28 days. Once the enforcement notice has been issued, the rights holder is provided with a copy of the enforcement notice, but that notice must not contain the name or contact details of the account holder.
The rights holder is then entitled to have the matter heard before the New Zealand Copyright Tribunal.

Silver bullets

Simple answer? New Zealand’s three strikes system has not been the cash cow some may have expected, and not the silver bullet for stopping illegal downloading either.

Iain Tait

Despite the legislative amendments that brought the scheme to life in 2011, the first case was not brought to the Copyright Tribunal until the end of January 2013. Only five file-sharing cases have been heard by the Copyright Tribunal to date, and all bear similar features:

• The applicant, the Recording Industry Association of New Zealand (RIANZ), has claimed thousands from each account holder, that amount being the price of purchasing the music legally multiplied by an estimated 90 possible uploads, in addition to deterrent amounts and reimbursement of fees incurred. In one matter, RIANZ claimed a whopping NZ$3,931.55.
• In each case the Copyright Tribunal awarded the price of purchasing the music legally without any multiplier to account for uploads.

The highest award under this head of damages was NZ$7.17, which was arrived at by using the iTunes rates of NZ$2.39 per song, multiplied by three infringing songs.
This has occurred in three cases: here, here and here.

• The claims for reimbursement of fees paid to the ISPs were in each case reduced in accordance with legislation to contributions of NZ$50, representing approximately two-thirds of the claimed amount. Reimbursement of the NZ$200 tribunal fee was upheld in each case.
• The deterrent fee was considered by the tribunal according to the culpability of each account holder. The tribunal varied between awarding nothing at all and NZ$180 per song.

With the largest amount awarded to RIANZ falling short of NZ$800 – after ISP and tribunal fees are removed that amount falls to around NZ$525 – it is easy to see that the recording industry might feel a little short-changed.
Indeed, in the most recent case, involving infringements that were alleged to have occurred while the account holder was serving in Afghanistan, the tribunal awarded just NZ$255.97.
This resulted in a loss to RIANZ of at least NZ$20 once the ISP and tribunal fees are deducted.
Given the time and effort RIANZ must go to in order to enforce its claims – and the limited resources of tribunals – the tiny returns from their enforcement action make it hard to imagine this system being viable in New Zealand, let alone worth setting up in Australia.
Richard Freudenstein, is this really what you want?
Karl Schaffarczyk does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

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

The NBN will be disastrous for the music industry ... really?

By Karl Schaffarczyk, University of Canberra

The NBN could have disastrous results for the local [music] industry.

At least, that was the view of peak recording industry body the International Federation of the Phonographic Industry (IFPI) and local bodies, the Australian Recording Industry Association (ARIA) and Music Rights Australia, in a recent report.

But why would Australia’s National Broadband Network (NBN) be problematic?

The Age, The Register and other media describe the claims of IFPI and ARIA as “bleating”. The joint claim of the recording industry bodies is that without government and internet service provider (ISP) intervention to curb piracy, the NBN will destroy the music industry.

But this is just business as usual for the content industry. These claims are continuing a long tradition of claiming every technological innovation spells disaster, if not the end, of the industry.

Some 30 years ago the then-Motion Picture Association of America president, Jack Valenti, described the VCR as the movie industry equivalent of the Boston Strangler.

Even high-speed dubbing and blank tapes, digital audio tapes, Napster, Grokster and countless other technologies have been named as threats over the years. Despite these threats, the recording industry is still with us.

The beat goes on

Not only is the recording industry still with us – in Australia, at least, it is doing well. IFPI and ARIA report impressively strong growth (up 40%) in Australian digital music sales, and a small increase in overall revenue.

In an Australian context, the sales data in the graph below clearly shows that while sales of physical recordings are declining (dark green), those losses are being offset by the growth in sales of digital recordings.

The changing nature of music sales, as reported in the IFPI Digital Music Report 2013: Australian Case Study. IFPI

IFPI’s annual Digital Music Report repeatedly advocates for legislative intervention from government to compel ISPs to better enforce copyright.

They want ISPs to become “content gatekeepers” by either preventing consumers using services that permit file-sharing, or implementing enforcement protocols such as the American six strikes Copyright Alert System, which warns (and then reduces the internet speeds for repeat offenders) users who engage in illegal file-sharing on the internet.

Australian lawmakers have so far been reluctant to make this happen, and a major issue in the recent High Court case of Roadshow Films v iiNet was iiNet’s unwillingness to be the gatekeeper for Hollywood.

ARIA is now holding out for the current Law Reform Commission review of copyright and the digital economy to deliver a strong[er] copyright framework.

Human behaviour

Alarmist claims about the NBN tell us more about the music industry and its attitude to consumers than any inherent faults in consumer behaviour.

It is widely accepted that people download music and other content due to the failure of the market to deliver what the consumer wants.

This failure takes the form of insisting that old business models such as selling CDs and tapes in discrete markets be continued – while refusing to embrace the new digital culture.

Granted, the marketplace for legally-downloadable music has developed over the last few years and we now have online music stores and streaming services, but until now the online offerings have been inferior in many ways. Saddled with Digital Rights Management (DRM), small repertoires and high prices, many people had instead resorted to file-sharing services.

The logic in the IFPI report is attractively simple: if people can download songs from the internet using peer-to-peer (P2P) networks, and those people are then given faster internet speeds as provided by the NBN, they will download much more music. More downloads means fewer sales, and fewer sales means disaster for music distributors.

By giving Australia high-speed broadband, Communications Minister Stephen Conroy’s NBN project may pose a threat to the music industry. AAP/Lukas Coch

While there will always be people who prefer to “freeload” and not pay for content, the impact of Apple’s iTunes store has demonstrated that many pirate downloaders will happily convert to paying customers, but that iTunes has a negligible impact for existing content purchasers.

What this shows is that consumers want a simple interface from which they can pay for their music.

The music industry has long insisted on “digital locks” (“DRM”) to prevent the sharing of legally-bought digital music. But technological compatibility and digital rights management have also been a strong deterrent for consumers. Why pay for a song that only works on one or two music players?

It has been shown that DRM-free content – such as songs which are sold without any form of digital lock to prevent file-sharing – actually drives sales.

A grand don’t come for free

Price is another important factor in consumer needs. For decades when buying technology, Australians have been paying higher prices than our overseas counterparts. This applies to online and offline music sales too.

On Apple’s iTunes store, the standard price for one song is US$1.29 for Americans, yet the price for Australians is almost double that, at A$2.19 for the same song.

Timing and geographic segmentation is yet another issue for which the content industry fails to deliver to consumers. This is most obvious in the film industry, where Australians often need to wait months or years in some cases before a released film hits our screens.

The music industry is not immune to this either, and it is still standard practice to release all but the biggest names in music one market at a time.

While it is a long bow to draw to claim that piracy will disappear if content became cheap, DRM-free, easy to buy, and simultaneously released worldwide, it is clear that these are important factors driving online piracy, and fixing these matters will significantly reduce demand for infringing product.

Highway to hell

If the music industry is scared of a piracy-driven disaster occurring because Australians have high-speed broadband, it means they believe the only thing saving their bacon is the lack of bandwidth available in most homes.

It also means that despite being aware of what drives music piracy, the industry intends to continue treating its customers with contempt. Frances Moore, CEO of IFPI, summed up industry attitude to consumers in last year’s Digital Music Report:

The truth is that record companies are building a successful digital music business in spite of the environment in which they operate, not because of it.

The time has come for the music industry to find common ground with consumers, not do business in spite of them.

Karl Schaffarczyk does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

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

Battle royalty: is this the end of online radio streaming?

By Karl Schaffarczyk, University of Canberra

Online streaming of radio broadcasts may be a thing of the past after the Full Federal Court yesterday handed down a ruling that will result in radio stations paying higher royalties to the recording industry.

The Phonographic Performance Company of Australia (PPCA), on behalf of recording artists and music labels, won a declaration that internet simulcasts of radio programs fall outside the definition of a “broadcast” under the Copyright Act and are therefore not covered by existing licences granted to commercial radio networks.

Following on from a failed High Court bid to increase license fees, legal action was initiated in 2010 by PPCA to separate licensing for online radio programs from traditional broadcasts.

The PPCA’s purpose seems to be clear: to create a new revenue stream from online license fees. This was at a time PPCA was aggressively pursuing increases in their revenues, such as fee increases of 4,729% for operators of cafes and gyms.

Meet the players

The PPCA is one of a number of copyright collecting societies: when anyone plays recorded music such as a CD, MP3 or music video in public, permission must be obtained from the person or company that owns the copyright of that recording.

The PPCA represents many copyright holders – both record labels and individual artists. It is then the job of the PPCA to issue licenses for the public performance of recorded music, and to collect license fees and return those to the copyright holder.

Commercial Radio Australia (CRA) is the peak body representing commercial radio industry interests in Australia – it claims to represent 99% of commercial radio stations.

In short, if you listen to commercial radio then the chances are the radio station is a member of CRA.

Let the battle commence

In 2000, on behalf of its members, CRA obtained an “umbrella” license granting each member a license to broadcast recorded music, and those arrangements remain in place today.

At the time, radio stations making their broadcasts available online was a new thing, and it’s likely online content was not contemplated as a threat in the context of the agreement.

During 2010 the PPCA claimed that a CRA member radio station – NovaFM – had breached copyright in a work managed by the PPCA.

The argument was that NovaFM had played a song that was both transmitted on the usual FM band and simultaneously made available on the internet. The PPCA claimed the broadcast license issued to CRA members did not cover broadcasts also being made available online.

The PPCA based its claim of breach by referring to the wording of their agreement, which permitted members to broadcast licensed material. They went on to point out that making content available on the internet was not broadcasting, and therefore not covered under the terms of the license.

When is a broadcast not a broadcast?

In September 2000 the then-Minister for Communications, IT and the Arts Richard Alston made a determination that excluded certain services being defined as a broadcast, namely:

a service that makes available television programs or radio programs using the internet, other than a service that delivers television programs or radio programs using the broadcasting services bands.

Making an adjustment for the double negative (making an exception to an exclusion in the determination), we might interpret this to include as a broadcast:

a service that makes available … radio programs using the internet and delivers … radio programs using the broadcasting services bands.

In February 2012, when this case was first brought before the Federal Court, Justice Foster agreed with CRA’s reasoning on this point and dismissed the PPCA’s case on the grounds that a simulcast radio program was a broadcast, whether delivered using radiowaves or online.

The appeal to the Full Federal Court, explained

Yesterday’s ruling by the Full Federal Court overturned last year’s single judge ruling. Justices Emmett, Besanko and Yates took up the argument put forward by PPCA relating to legislative reforms designed to regulate datacasting (adapting broadcast services to provide internet) as being the motivating intention behind the issue of Minister Alston’s determination.

Streaming radio online and on devices may become a thing of the past. ahunziker

On this basis, the judges considered that delivery of radio and television programs could be categorised in three ways:

1. be delivered by the use of any means, including the broadcasting services bands
2. be delivered or made available using the internet
3. be delivered or made available using the internet and the broadcasting service bands

The Court found the radio program by NovaFM was supplied to the public by two simultaneous but separate services: the first being a traditional radio broadcast falling into the first category, and the online version fitting the second category, but accordingly not a broadcast.

Some lingering static

In accepting the PPCA’s interpretation of the ministerial determination being for the purpose of regulating datacasting, we encounter wild inconsistencies within the law.

Viewed through this lens of regulation of datacasting, the ministerial determination effectively makes any television or radio programs delivered over the internet fall into the category of a broadcast if the internet service over which it is delivered is a datacasting service (for example wireless internet using the analogue TV spectrum).

Yet the same television or radio programs delivered on any other form of internet access (such as ADSL broadband) is not a broadcast.

Effectively the ruling is saying that regulation is not applied on basis of content, or the originator of the content, but in how that content is delivered to a consumer, including distinguishing between methods of accessing the internet.

Regulating television and radio in this fashion simply cannot serve any useful purpose.

That said, if we consider the ministerial determination through a lens of regulating incumbent broadcasters while not stifling progress, efficiency and innovation, we find that radio and television programs can still be categorised in the same three ways. With the results being, respectively:

1. incumbent broadcasters are caught and continue to be regulated
2. “new media” services including YouTube, online movie and music services are not considered to be “broadcast” services, and so are not subject to broadcast regulation
3. incumbent operators who simultaneously broadcast and stream their content are subject to technology-neutral regulation as broadcasters – without this provision, radio and television services would be subject to two distinct regulatory schemes. This may yield unexpected results – e.g. doubling of compliance costs, and doubling of sanctions for content which may breach a law

Stay tuned

Due to the high stakes involved it will be very surprising if the CRA does not seek leave to appeal to the High Court.

Without a successful appeal against this court ruling, the PPCA is now in a position to demand fees above the present 1% regulated fee from any radio station that makes its broadcast stream available online.

Given recent PPCA demands of huge increases in license fees for other users of recorded music, a likely scenario is that many broadcasters will simply stop making their content available online.

Karl Schaffarczyk does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

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

Say Hola! to the newest route around web censorship

By Karl Schaffarczyk, University of Canberra

The ongoing copyright arms race between content owners and internet users has taken a new turn. Israeli firm Hola! has recently launched a suite of products that are variously designed to bypass geoblocking and accelerate internet-access speeds.

Hola! is the brainchild of entrepreneurs Derry Shribman and Ofer Vilenski. They have set out to fundamentally change the way the world wide web operates by creating software which makes the web more efficient and harder to censor.

Hola! is comprised of several products:

• Browser extensions which work on Windows and Mac with Google Chrome and Mozilla Firefox. These plugins only bypass geoblocking.
• Client software for Windows which functions as web accelerator, geoblock bypass, and censorship bypass service.
• An Android app which operates as a web accelerator only.

Hola! bypasses restrictions on sites which are usually geoblocked. http://www.Hola.org

BBC iPlayer, Hulu, Netflix … and VPNs

Catchup TV and online movie services such as BBC iPlayer, Hulu, Netflix and many others use geoblocking – and so are not available from within Australia.

But circumvention of these geoblocks is commonplace with the use of a Virtual Private Network (VPN) or proxy server. During the London Olympics the media was awash with stories of people using these methods to access the BBC’s online coverage of the Games.

These VPNs and proxy systems are either subscription services, or they operate on a freemium model where a limited or ad-supported version of the product or service is given away in the hope of selling consumers a “full” version of the product.

VPNs were designed as a way of securely connecting a remote computer to a corporate network, and using a VPN is a rather clumsy method to access multimedia content. All traffic is routed through the VPN which may limit access to other services, and the VPN needs to be connected and disconnected to various servers to access content in different countries.

Hola! is different

Not only is Hola! free, but it’s different to other services because it utilises peer-to-peer technology, where traffic is not re-routed through central servers but via other computers which have the Hola! Windows client installed.

This peer-to-peer nature will make it difficult for Hola! to be blocked in the same way Hulu has blocked some VPN and proxy services.

The Hola! browser extension is also by far the simplest and most elegant method to bypass geoblocks. The inflexibility and complications which come with setting up a VPN or altering rarely-changed DNS settings can limit the function of a computer for everyday use.

Once Hola! is installed, its function can be toggled from an icon in the browser.

Is Hola! legal?

Most people are familiar with technological protection measures (TPM) in the form of region coding on DVDs. Those TPMs try to prevent the disc being copied and try to prevent playback in a place other than the market in which the disc was sold.

Region coding allows Hollywood to segment global markets, releasing movies to one market at a time, maximising the effect of promotional campaigns, for instance.

Geoblocking is used by the entertainment industry to perpetuate this same market segmentation online – which includes Australians paying higher prices. For example, the American service Netflix at $US7.99/month compares poorly with local Quickflix at $A14.99/month.

Geoblocking is a technological protection measure but due to a special exemption in the definition of TPMs in the Copyright Act, it is not illegal to break TPMs that prevent the playback in Australia of a film obtained from outside Australia – so long as it is a non-infringing copy.

While using a region-free DVD player clearly falls within this exemption, bypassing geoblocks remains an untested grey area.

In August 2012, consumer advocacy group Choice highlighted this grey area in a submission to the Attorney General’s Review of Technical Protection Measure exceptions.

The grey area centres on whether video streaming can be considered a “non-infringing copy”. When users sign up to a service – let’s take Netflix as our example – they agree to Terms and Conditions that include a clause on geographic limitations:

Geographic Limitation: You may instantly watch a movie or TV show through the Netflix service only in geographic locations where we offer our service and have licensed such movie or TV show …

The interpretation of this clause of the Terms and Conditions, and the weight given to respecting these must be weighed against the intent of the exemptions in the Copyright Act.

This is critical in deciding whether or not accessing movie content from Australia will be defined as a “non-infringing copy”.

Facebook in China, Twitter in Tehran, YouTube in Pakistan … or Gmail at the office

Social media services are censored or completely blocked in many countries, and most large workplaces limit access to various websites for security and productivity reasons.

The tools used to bypass these blocks to date include the US Navy-developed high security router software TOR, VPNs and other security software.

Hola! explained.

While these might be appropriate for some uses, they are complicated to use and are overkill for an individual who just wants the freedom to talk to their friends on Facebook.

The Hola! client software makes bypassing these blocks trivial. When a user wants to visit a blocked site, the Hola! client takes that request, encrypts it and sends it to another computer with Hola! installed.

That second computer works as a proxy by then decrypting the request and then accessing the relevant service. The resulting content is again encrypted by the second computer and forwarded to the original user.

For speed and efficiency, the Hola! client will use several proxies – with each handling a small part of the traffic.

The lack of a central server in a peer-to-peer model such as this means that Hola! is difficult to block – a successful blocklist would need to be constantly updated and could run to thousands of internet addresses as it would need to block every user of the Hola! client.

Bypassing government censorship is widely accepted as a good thing – at least in western democracies.

Hola! is yet another example supporting American innovator John Gilmore’s famous quote: “the Net interprets censorship as damage and routes around it”.

Karl Schaffarczyk does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

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

Can Kim Dotcom's Mega beat the law where Megaupload failed?

By Karl Schaffarczyk, University of Canberra

Just 12 months after being arrested for copyright infringement, racketeering and money laundering for his involvement with now-defunct cyberlocker Megaupload, and despite facing extradition from New Zealand to the US to face such charges, Kim Dotcom has launched Megaupload’s successor: Mega.

The site went live on January 19 with more than 100,000 users signing up in the first hour and more than 1 million registrations in the first 24 hours.

While there are obvious similarities between Mega and Megaupload, a key point of difference, according to Dotcom, is the fact Mega and its users are protected by a solid legal framework.

So is Dotcom right? Will Mega be able to avoid the legal issues that led to Megaupload’s demise?

Wait, what is Mega even for?

Mega is a file storage service similar to Dropbox, Google Drive, and Apple’s iCloud.

The idea behind such cloud services is simple: users may upload data and then access that data from elsewhere. Most services (including Mega) permit sharing of the uploaded files with others.

It is through this sharing mechanism that users can commit acts of piracy by sharing copyrighted material such as music, movies, books and so on.

Engaging in or facilitating copyright piracy is outlawed in many countries, and offenders face sanctions including liability to pay damages or disgorge profits to rights holders.

Safe harbour

Content hosts and internet providers usually have access to “safe harbour” provisions limiting their liability when user behaviour infringes copyright. These provisions are generally conditional on the content host removing the infringing material as soon as they are aware of it, and having a policy of disciplining users who repeatedly break the rules.

The indictment of Kim Dotcom and others in the “Mega Conspiracy” claims instead that Megaupload actively supported users who used the service to share infringing material.

According to the indictment, Megaupload was the single largest piracy repository on the internet. And by facilitating piracy the service apparently cost copyright owners US$500 million in lost revenue while making US$175 million in profits.

Same, but different

One of the the features that sets Mega apart from its predecessor is the encryption of files during the upload process.

Encrypting files in this way means all files stored on Mega are useless to anyone who doesn’t have the decryption key. This means the administrators of Mega cannot view the contents of a file, and so they cannot determine whether a file contains business material or the latest Hollywood blockbuster.

A simple legal argument can then be made: if Mega doesn’t know what it’s hosting, then it cannot be held responsible if that content is infringing, or otherwise illegal.

But like most simple arguments, this one is wrong.

Infringement notices

Most content hosts have no idea what content they are hosting, but instead rely on notices from copyright owners to identify content which may be infringing. In the case of Mega, any links that are distributed for the purpose of sharing copyright material will still result in infringement notices being sent.

YouTube is an example of a site on which all uploaded content is checked via an automated content-matching process. This process is in place to detect unauthorised copies of video material or soundtracks. By providing this tool to copyright owners, YouTube avoids most claims of piracy.

Mega, on the other hand, uses across-the-board encryption, and because of this it is technically impossible to proactively filter or check content.

Without these automated tools, content owners are left with the Sisyphean task of locating and reporting infringing content to Mega.

Nothing has changed in the legal landscape with respect to liability of content hosts. In order to use the “safe harbour” provisions, Mega must remove infringing content as soon as it becomes aware of it, and must also discipline the person responsible. Without the “safe harbour” provisions Dotcom can expect another raid in the near future.

Legally watertight?

The Mega site help files and terms of service are very copyright focused. They require users to not infringe on anybody else’s intellectual property, nor do anything illegal.

All responsibility for content is with the user. The help files and terms of service also set out processes for the handling of copyright notices, and how to make counterclaims.

In all, it’s fairly standard legal boilerplate comparable to most other content services – with the bonus that it invokes Article 12 of the Universal Declaration of Human Rights. That is:

No-one shall be subjected to arbitrary interference with his privacy, family, home or correspondence, nor to attacks upon his honour and reputation. Everyone has the right to the protection of the law against such interference or attacks.

In theory, Mega is a model content host which appears to comply with best practice. User content is kept private through encryption, procedures are in place to take down infringing content upon notices being filed, and Mega promises to terminate the accounts of repeat infringers.

What now?

Those with a stake in Hollywood and the music industry are furious with Mega’s launch. Anti-piracy lobby group StopFileLockers has already commenced a successful campaign to cut off funding to Mega. They claim that the new Mega is simply a re-launch of Megaupload.

StopFileLockers has highlighted that as Mega only holds encrypted files, automated processes cannot be used to locate infringing material, and so will be a haven for copyright pirates.

The behaviour of Mega over the coming months will send a clear signal to copyright holders and those who file-share. The question remains: can Dotcom’s latest venture stick to the rules, or will the entrepreneur again find himself in hot water?

Dotcom is using privacy as the reason to offer a service which automatically encrypts all content. While privacy is important, it appears that the purpose of the automatic encryption is primarily to provide Mega with excuses to not proactively co-operate with rights holders.

By structuring their service to technically preclude co-operating with rights holders, Mega is a distinctly copyright unfriendly service.

Karl Schaffarczyk does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

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