First let's have a quick bit of background. Prices for stuff like songs from iTunes right through to major commercial software is more expensive in Australia. We pay more for subscription services and any amount of hardware. My favourite example is that for the price of a digital download of a particular professional Adobe product in Australia you can fly to Los Angeles, buy a physical copy of the software, get overnight accommodation and then fly back... and still have money left over!
The 150 page report has now been handed down and has 10 recommendations. I don't intend to write a massive analysis of the report, instead I'll summarise the recommendations and potential impact if they miraculously become law...
Price discrimination and consumer impacts
1. The Australian Bureau of Statistics (ABS) develop a comprehensive program to monitor and report expenditure of IT products domestically and overseas.
This sees the ABS studying and keeping track of the costs Aussies pay for IT products to keep an eye out for potential Australia Tax offenders.
2. The Australian Government, in consultation with universities, conduct a comprehensive study of future IT needs and costs faced by Australian universities.
This really relates to keeping costs down and optimising IT purchases for Australian education institutions which is, let's face it, a good thing.
3. The Australian Government consider a whole of government IT procurement policy.
By having a whole of government approach to IT purchasing it helps the Government make sure they are getting the best deal across the board. No notes on whether a reduction in IT costs would flow through to taxpayers though (HA, as if).
Copyright, circumvention, competition and remedies
4. Parallel import restrictions still found in the Copyright Act 1968 (Cth) be lifted and the parallel importation defence in the Trade Marks Act 1995 be reviewed and broadened.
First up, seriously, this has been enshrined in law since 1968? Way to keep up guys. Essentially this refers to importing of physical media (particularly books) and selling at a lower price than the standard Australian retail price, thereby reducing the opportunity for local retailers and content producers to earn an income. So we know the Australia Tax was well in place 45 years ago. Lifting this in a global marketplace makes sense and encourages competition. The Trade Marks Act review is more about preventing cheap, unauthorised knock offs from flooding the market.
5. The Copyright's Act section 10(1) anti-circumvention provisions be amended to clarify and secure consumers' rights to circumvent technical regional restrictions.
The simplest example of this is mod-chips for games consoles. For a brief period it was actually legal to mod (or offer a modding service) consoles for the purpose of playing imported games. Lobbying from various parties closed this loophole and it is currently considered an act of copyright violation to bypass any technical restrictions. This recommendation is a step backwards in a good way!
6. The Government investigate options to educate consumers and business in the extent and tools of circumventing geoblocking mechanisms and how their rights may be affected should they do so.
Here is my first big wow moment. Geoblocking is what prevents Australians from accessing digital content from a different region (for example the US iTunes store) where the price of that content is cheaper. Choice magazine has already run stories showing how to circumvent geoblocking, but to recommend that the Government officially support bypassing these restrictions would have to be a world first! Of course this only applies to products that are officially being sold in Australia so I'm afraid it does not mean free reign access to things like Netflix and Hulu since they are not offered in our market.
7. Consider the creation of a "right of resale" for digitally distributed content and clarification of "fair use" rights for consumers, business and educational institutions, including restrictions on vendors' ability to lock content to a particular ecosystem.
Second wow moment! Reselling of digital products has been quite the contentious issue amongst digital consumers. Essentially you are buying a licence to access a product instead of the product itself. By enforcing a "right of resale" we have enforcement of the consumers' right to ownership of their purchase. Additionally the "fair use" right refers to being able to make a copy of your content in a more convenient format which ties in nicely with restrictions of locking content to a particular device or system. A great example is ebooks. Say you own a Kindle reader, but Kobo has a book you particularly want at a much better price. This recommendation would allow you to purchase the Kobo edition and convert it to a format that you can use for your personal enjoyment.
The problem with the above is there does need to be some measure in place to ensure that the consumer doesn't keep their "fair use" copy should the resell the original. Essentially that would mean they now have an copyright infringing copy but the personal care factor would be quite low.
8. Repealing of section 51(3) of the Competition and Consumer Act 2010.
This one has pretty much defeated me. The general gist I get it that it relates to contravention of the Act that relates to licence restrictions. This would be a logical follow on from the previous recommendation where a company tried to enforce digital restrictions and tried to pursue someone for bypassing their copy protection in order to use their content on a different device. I may be wrong.
9. The Australian Government consider a ban on geoblocking as a last resort if nothing else works.
Great idea! Good luck enforcing it though.
10. The Australian Government investigate amending the Competition and Consumer Act so that contracts or terms of service that enforce geoblocking are considered void.
Adobe would be hating this one. It is pretty standard in licensing agreements that if you buy a digital product from a different region then you can not get any support for that product which effectively locks you to the local product for commercial software. Again this would only relate to products available in Australia so still no Netflix or Hulu guys.
Conclusion
There are some seriously revolutionary proposals up there, especially with regard to long overdue copyright reform. It would be nice to think that the recommendations will make it through, however there is always a but, possibly multiple buts.
With a federal election looming none of the above is going to get any consideration until it's all over and the dust has settled, plus should we see a change of government then there is a good chance it'll get buried and not see the light of day until there is sufficient outcry from the general public. It is unlikely there will be enough interest to make this an election issue so it will be way at the bottom of the list of priorities for both sides.
Should it reach parliament for consideration it will have to contend with lobbying from a number of businesses and the entertainment industry. It would not be the first time reform has been overturned through such lobbying and since "fair use" provisions feeds Hollywood's fear of not being able to resell you the same content in a more up to date format you better believe they'll be doing all they can to stop it.
We will probably see an initial roll on effect of slightly better prices while the IT industry gauges the possible impact of the recommendations and waits for the official Government response. Unfortunately I don't think we'll be seeing legislative change anytime soon so once the next big issue diverts attention the prices will creep back up and the Australia Tax will again be in full effect. I hope that at the very least we'll see the "fair use" recommendations fix the ridiculous situation where we are allowed to have a copy of purchased content, but we are not allowed to bypass copy protection or download a copy in order to get it.
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