Big Media Companies Insist That VPN Services Violate Copyright Law

Back during the SOPA fight, in a discussion with someone who was working with the politicians pushing SOPA, I pointed out that such a law would encourage much more encryption -- and the response was "that's no problem, because we'll just ban encryption next." As stupid and impossible as such a statement is, it shows the mindset of some copyright extremists. Thus, it should be no surprise that they're actually starting down just such a path in New Zealand. As we noted last year, Kiwi ISPs, frustrated that their users kept running up against geoblocks, have started offering VPN services that get around geoblocks as a standard feature there. Basically, this is nothing more than a recognition that the internet really is global and attempts to pretend otherwise are pretty fruitless.

However, the big media companies are not happy about this turn of events. A week or so ago, a bunch of them (Lightbox, MediaWorks, SKY, and TVNZ) teamed up to threaten New Zealand ISPs that if they didn't stop offering "global mode" VPN services to customers, that the media companies would sue -- arguing that merely offering such a service was copyright infringement. The letter is full of the usual bluster:

“Offshore providers, such as Netflix US, Hulu, Amazon Prime and BBC iplayer do not have the right to exploit the copyright works in New Zealand,” the letter says. Licenses they hold apply only to specific overseas locations and prohibit customers from circumventing geo-blocking measures and other content protections.

That may be true, but whether or not those companies are operating in New Zealand is not an issue that is of concern to the ISPs, who are providing internet access to the entire internet. If Netflix US, Hulu, Amazon and the BBC were the ones sneaking around the geoblocks, the companies might have a point. But arguing that merely offering a VPN service to users somehow violates the law seems like a crazy interpretation of copyright laws.

But, of course, crazy interpretations of copyright laws are the norm these days, and there are always some lawyers who will insist the media companies have a case, such as the lawyer quoted in that article. The basic argument seems to be a variation on felony interference of a business model:

The four are claiming that Global Mode, offered by Slingshot and Orcon, and similar services offered by other providers, are ‘unlawful’ for several reasons.

Top of the list is infringement of the Copyright Act 1994, ‘either directly or as a joint tortfeasor’.

The four are also claiming the services are unlawful in providing ‘misleading representations’ in stating or implying ‘without a proper basis’ that it is lawful for New Zealand based users of the services to access content from the offshore providers, and that ‘circumvention of geo-blocking measures in this way is permitted by New Zealand law (just like parallel importing of DVDs)’.

The four are also claiming that use of the services constitutes a clear breach of the terms and conditions of the offshore providers – being the likes of Netflix, Hulu and Hulu Plus, Amazon Prime and BBC iPlayer.

From a loose reading of this it seems like they're really arguing three things: (1) that offering such a service is a form of "inducement" to infringement, (2) that this is a form of circumvention of restrictions, which violates anti-circumvention clauses and (3) that this violates the terms of those video services.

The third argument is meaningless since that's an issue between those services and the ISPs, not the media companies and the ISPs. The first one seems like a stretch but probably depends on a few factors, including how the services are marketed and whether or not merely viewing geoblocked content is a form of direct infringement (which seems like a stretch to me). The circumvention issue also seems like a stretch, but may depend on the specifics of New Zealand's Copyright Act, which I'm not as familiar with. You can read it here though to see which sections might apply.

Either way, with the threat looming, at least one ISP has caved, saying it's not worth the fight:

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.”

Of course, whether or not offering such a service technically violates copyright law is kind of besides the point, as the very idea that offering such a service should be against the law is crazy. Such services provide real value to consumers not just in getting around pointless geoblocks, but also in protecting privacy. Trying to outlaw VPN services like that just to protect obsolete business models of media companies pretending the world is not global these days, just seems like yelling at the tide. But, given that it's big old media companies we're dealing with, they still haven't figured out that going with the tide is much easier than ordering it not to come in...

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