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UPDATE: Sky TV, Vocus in war of words over website ban

UPDATE: Sky TV, Vocus in war of words over piracy website ban

(Updates to include Spark comment in paragraphs 15 and 16, adds detail of Sky filing)

By Sophie Boot

Nov. 29 (BusinessDesk) - Sky Network Television, New Zealand's biggest pay-TV operator, will ask the courts to force internet providers Spark, Vodafone, Vocus and Two Degrees to prevent consumers accessing free streaming sites such as The Pirate Bay, but at least one provider is fighting back.

Sky plans to ask the High Court for an injunction on the four providers, who collectively hold about 90 percent of New Zealand's internet market. In an originating application sent to the internet providers as part of its consultation before filing, it says this is necessary to protect and enforce its rights and the orders sought "are in the interests of justice."

In the application, Sky said it has exclusive licensee of copyright in various valuable works including films, television programmes and sporting broadcasts, and has paid substantial amounts for the exclusive right to show the works in New Zealand. Free streaming sites "reproduce and make available for free, high-quality unauthorised copies" of those works, and infringe on copyright and Sky's legal rights, it said.

Sky said courts in other countries have ordered providers to disable access to the target websites on grounds of copyright infringement, and the impact on individuals would be "minimal and proportionate" as restricting access to the target websites "would not restrict access by internet users to legitimate online content."

Vocus, which runs Orcon, Slingshot and Flip, said the move was "gross censorship and a breach of net neutrality."

"It isn’t our job to police the internet and it sure as hell isn’t Sky’s either, all sites should be equal and open," said Vocus consumer general manager Taryn Hamilton. "Delivering a competitive commercial alternative to piracy is the best way to fight piracy.

"The success of Netflix, iTunes and Spotify proves that people are willing to pay to access good-quality content. It’s pretty clear that Sky doesn’t understand the internet, and is trying a Hail Mary to turnaround its sunset business."

Vocus said its statistics show New Zealand interest in The Pirate Bay has less than halved since Netflix launched in New Zealand. Today, traffic to The Pirate Bay is only 23 percent of its 2013 peak, and Netflix has fast become the largest content provider in the country, it said.

In August, Sky posted a 21 percent decline in annual profit to $116 million as content costs increased, and revenue and subscriber numbers fell. The pay-TV operator faces increased rivalry from online streaming video services such as Netflix and has seen its subscriber base come under pressure while its programming costs continue to rise. Its costs to secure programming rights increased 5.6 percent to $349.4 million in the latest year.

Meanwhile, its subscriber numbers fell 3.3 percent to 824,782, with residential subscription revenue down 3.7 percent to $725.1 million, due to fewer satellite customers and a lower uptake of premium services such as sports and movies and lower pay-per-view buys. Increased subscribers for its subscription video-on-demand service Neon and sports service Fan Pass helped 'other subscription revenue' increase 3.7 percent to $82.2 million.

In response, Sky said that 42 countries around the world have laws allowing the banning of "blatant piracy sites" by internet providers, including Australia, the UK, Singapore, many countries in the EU - "and if anything New Zealand is lagging behind in our legal protection for content creators and legitimate content businesses."

"We are talking about websites that are designed for no other purpose than to illegally pirate content," Sky said. "This is not about a 'breach of equality and freedom of information' – it’s about calling out pirate sites who pay nothing to the creators of movies, TV and sport content and simply steal it for their own gain.

"Sky is not 'taking it upon ourselves to make censorship calls'. We are proposing to follow a thorough and careful legal process, which involves seeking a court order under the Copyright Act that requires ISPs to block specified infringing sites.

"Vocus’ claims that we’re attempting censorship are nonsense, and demonstrate that Vocus is out of touch with what is happening around the world – not to mention that they seem to be wanting to align their brand with pirates who steal content," Sky said.

A spokesperson for Spark said "we understand the desire of content owners to protect their legal position when it comes to copyright of content – and we have some sympathy for this given we invest tens of millions of dollars into content ourselves through Lightbox."

"However, we don’t think it should be the role of ISPs to become the “police of the internet” on behalf of other parties. The only exception we have made to date on this is the Internal Affairs Digital Child Exploitation Filtering System (DCEFS)- which blocks websites that host child sexual abuse images - and clear instances of phishing. In both of these cases we act due to the substantial harm caused by such activities."

In an emailed statement, Vodafone said it was aware of the order Sky intends to seek, and "would, of course, comply with any court order."

Sky said in its application that it has consulted with the providers over the orders sought, and "has done everything practicable to accommodate the ISPs’ requests and suggestions on the orders."

(BusinessDesk)

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