Kiwi ISP Chief says that three strikes in the wrong approach

September 2011


Allan Freeth, The chief executive of New Zealand ISP TelstraClear, has spoken out against his country’s Copyright (Infringing File Sharing) Amendment Act 2011, which comes into force on September 1st. The New Zealand legislation is another example of the ‘three strikes’ legislative approach adopted by France, South Korea and which will be implemented in the UK. The Act introduces a set of penalties (described by some as ‘draconian’, others as ‘ineffective’) that impose fines and possible account suspension for infringing activities, and it involves Internet Service Providers in the process of identifying and notifying account holders based on IP addresses.

Freeth said that “TelstraClear respects copyright and supports the ability of rights owners to realise value from their intellectual property. But a business model that has to be propped up by specific legislation in this way is flawed and needs to change,” adding The new law will not help copyright owners defend their rights” and “It may encourage parents to take more notice of what their kids are doing online, and that’s a good thing. But it won’t stop those who really want content from getting it.”

Freeth said his company’s market research found definitive reasons why people illegally downloaded content which were: (a) the legal product takes too long to become available; (b) it costs too much; (c) the packaging and distribution of physical music, movies and games is unnecessary and costly; and (d) they believe the business model is outdated and out-of-touch.

Three main themes emerged from TelstraClear’s study which hopes to reconcile the financial needs of content owners and creators with customers’ expectations for content in a broadband world. One was to forge stronger bonds between the artists and the audience, which the respondents thought would result in reducing the overhead costs of traditional business practices major companies and therefore lowering the cost of legitimate content. Second was to implement different business models, such as advertising supported, sponsored, or getting lower quality for free and paying for improved quality. Third was to distinguish between consumers who copy for personal use and people who profit from illegally copying and selling content, with the latter receiving harsher punishment.

Freeth said “Instead of bringing in a law that we believe will not and cannot work, our government should be breaking monopolies, allowing personal choice and letting New Zealanders experience information and entertainment when the rest of the world does” adding “Instead, it has chosen to introduce a law that could turn ordinary Kiwis into law-breakers.”

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