iiNet's Steve Dalby To Village Roadshow: 'It's Not Our Job To Stop Online Infringers'

Return fire! After the head of Village Roadshow Australia, Graham Burke, accused iiNet and its Chief Regulatory Officer, Steve Dalby, of lying about piracy, Dalby fired back saying that the ISP doesn't condone copyright theft before adding that Burke is concerned about losing his "middle-man status" in content distribution. Oh, it's on.

Yesterday in an interview with Gizmodo, Co-CEO of Village Roadshow, Graham Burke, accused iiNet of weaving a "fabric of lies" about how the content industry is responding to piracy.

Burke also said that iiNet's Stephen Dalby had made "outrageous" comments in a recent call-to-arms to customers, asking them to write to the government about their piracy concerns.

After the article was published yesterday, iiNet's Dalby took to our comments section to respond: "Perhaps we've touched a nerve," he wrote.

Burke believes -- like the Attorney General George Brandis -- that Australia is "statistically one of the worst countries in the world" for piracy. Dalby, however, notes that Australia is also a highly successful market for legal content distribution as well.

"Mr Burke is obviously concerned about the increasing threat to his 'middle-man' status by the changes in technology and has failed to mention his colleague Simon Bush's comments that the (Aust Home Entertainment Distributor's Assoc) figures showed that "on a per capita basis Australia is second only to the United States in digital consumer revenues.

"So Australians are not only the worst pirates, but one of their best performing markets. Outrageous!," Dalby wrote.

He wanted to make it clear from the outset that iiNet isn't interested in its customers stealing content, before using Burke's assertions against him.

"Piracy is wrong. We don't condone it. But it's not our job to fix.

"Mr Burke suggests that my comments are outrageous. I'm sure he doesn't like us pointing out some of the outrageous suggestions from his own industry.

"You know, stuff like "You wouldn't steal a car, you wouldn't steal a handbag...It's not our job to catch car thieves. It's not our job to catch bag-snatchers. It's not our job to stop on-line infringers. Whoa! 'Outrageous!'".

Burke also accused iiNet of profiteering from the pirates on its network. Dalby says that's a misnomer.

"Mr Burke also shows his ignorance of the ISP revenue model. Not only is he totally wrong, but I think he fails to be outrageous. The ISP subscription model, commonly in place in Australia, does not charge by the download, as he suggests, it is a fixed fee per month. In that model ( a bit like gym membership) the less data a customer uses, the more profitable they are.

"This was an argument that failed the logic test in the High Court, but don't let that get in the way of your outrage Mr Burke."

All that, before bringing it home strong:

"Finally, if this is all about protecting 906,000 Aussie jobs why is it that not one single example of Aussie content ever gets a mention. It's always about American movies, music and TV.

"If you want to protect Aussie jobs, Mr Burke, how about you turn up to the industry talks and put something on the table? Where is the quid-pro-quo for Australian ISPs to do the bidding of your American masters?

"No. I thought not."

You can see (and upvote) Dalby's comments here.



    I still haven't seen one other ISP stand up and support Steve Dalby... It's pretty cowardly to just sit back and see where the shit sticks imo... Go Steve..!

      Unless there is an affect to their bottom line, don't expect to hear from any other ISP. Whether the push falls flat or is supported, at the end of the day consumers will need to purchase access from ISPs no it will always be business as usual.

      iiNet have always tried to do what's best for the customer: even when Telstra has actively kicked iiNet off certain infrastructures because iiNet (a company has second hand solutions because it rents from Telstra) was making Telstra first hand products look bad.

      Last edited 19/06/14 9:19 am

        I'd say iiNet aren't doing themselves any harm here though, they will pick up customers for being the upfront ISP we need in this country. Hell if I wasn't stuck in a contract atm I'd jump ship now... :)

          I'm with iiNet and I'll continue to be with iiNet.

            I am not with iiNet (been with TPG for so long that I dont see a reason to switch) but I definatly recommend iiNet to anyone I know who is looking for internet advice.

              Same. I'm with TPG at home now and Virgin for mobile broadband. I have looked at the costs of switching and to get about 300Gb less (home - i'm actually on unlimited but since 500Gb is the limit for people whose exchanges don't have access to the unlimited plan, thats the limit i'm working with) and 2Gb less (mobile) than I can use now would cost me the same money. Plus there are setup fees ($75), cost of a sim card ($20), etc.

              Even though I have to factor in the monly cost of a Stealthed VPN ($5/month) for TPG as TPG do action DMCA notices even though they are not obliged to in this country, that is a small extra price to pay for unlimited home broadband.

              I really like what iinet are doing - family members are with them and I would encourage anyone actively looking for a new plan to go with iinet.

      Well the two other ISPs that are similar sized or bigger both have a massive stake in subscription-based cable TV...

    perhaps we need to show Mr. Burke the way to nearest burn hospital

    i wish i can upvote this enough

    “on a per capita basis Australia is second only to the United States in digital consumer revenues."

    If the Netflix model (global simultaneous availability) comes to Australia - we will rocket to 1st place overnight - guaranteed.

      Only if the price is commensurate...! :)

        Not just the price. The range has to be there too.

        If the price is the same as the US but the range is less than that of the US, then it's a waste.

          It will never be equal to the US version , The UK version is a watered down version.

            Then Netflicks better get used to VPN connections. 'Cos anything less than a US equivalent in price and range is unwelcome here.

            Last edited 19/06/14 9:52 am

              I agree , It would take a lot for me to cancel my VPN and US Netflix sub.

              I don't think Netflix minds us using VPNs. It's the distributor middle-men who are getting cut out of the loop who mind. They mind a great deal.

            This. I don't know if @wisehacker and @timmahh heard the LouisCK 'All Australians Pirate' soundbite interview, but he very clearly touched on then veered the hell away from talking about his discussions with publishing/distribution and how 'Americans get things first'. If you go back and listen to the interview when he starts saying:

            "We have shows that have been on the air here for like, three years? And we won't even give them-- if they're given the option? Like... everybody in the world is like, "Take my fucking credit card and just let me have the thing and I'll pay, but if you're gonna be a pain in the ass... FUCK YOU, I can steal ALL of it! So the whole country of Australia rips TV. So when I learned this, so when I put my beacon special, one of the big important things to me was that it was globally available, right away... and they're happy to buy it. Right? So I told FX they should sell my show on my website. And they said that we can't do that because we can't let other countries see it before..."
            "Oh boy..." [Edit: This is the point I'm pretty damn sure the radio producer was furiously waving his hand in front of his throat in a slicing motion.]
            "And I'm, but the-- what they're doin', all those companies and this... piece of shit fuckin' company,"
            *interviewer laughs*
            "--that we're talkin' on right now? Is they're keepin' money out, it's a cage it's keepin' money out, it's not keepin' it in, right? They think they're keepin' money in, but they're keepin' it out."

            From this and the behaviour we've seen, I'm pretty convinced that maintaining American primacy is a huge deal to some content providers and distributors.

            Last edited 19/06/14 10:23 am

              Hehehe. I actually have.

              Look near the end of thread and see me praise the cage analogy.

              Best example yet.


          For a while I subscribed to the streaming service on the PS3 (Quickflix? something like that) but wound up ditching it because the range was mostly a small number of older titles. There was some newer material, but not much of it. Cost was around $15/month as I recall, similar to what Netflix subscribers pay for a MUCH broader service.

          It was possible to page through their entire catalogue in a few minutes.

          We'll never get the full US range, but if we only get *half* the material it will still be a heck of a lot of content.

        If we did adopt the US based model including pricing we would not necessarily move past the US in raw revenue numbers, remember most digital content in Australia today is delivered by virtual monopolies if we open this up then prices will fall so the overall usage will go up but it may not offset the downturn in yields on content. The old market share vs yield conundrum.

      Only if there is parity with the price and range. If either is not as good as the US version, then the only guarantee is a wasted investment.

      Personally, I would only use Netflix here (ignoring the fact our infrastructure is ****house) but only if the price is the same and the content range is the same or wider.

      If so much as one program/movie is absent then I would not be interested.

      Stream quality is still a concern, if they allow people to download the whole thing in advance then yeah I could definitely see it working.
      Or if we somehow got an NBN.

        I dunno, I can stream HD off US Netflix with little issues, so you'd think an Australian system with content servers located in Australia would have no problems.

        This is actually a bigger concern for the coalition with their watered down NBN. If the Australian public gets the content but can't access it because of the government's backwards solution it would put the focus on the government - where it does not want it. It's probably happy that we don't have the options for content right now.

          Its almost like the LNP had a discussion with the owner of Foxtel Rupert Murdoch who told them to scrap a 93% FTTP rollout as this would open up too much competition to his vastly over-priced, poorly contracted and limited content service Foxtel.
          If we did have 93% FTTP then the vast majority of people could be guaranteed to have the availability to stream whatever content they want from any number of suppliers.
          Don't forget the LOWEST FTTP NBN Plan speed (12/1 Mbps) which if you were on would give you actual real-world speeds of around 10/0.8, versus the current ADSL2+ Plan speed (24/1 Mbps) giving you anywhere from 1/0.1 > 22/0.8 for a fraction of the cost. If you want faster you could chose 25/5 and get 23.5/4.5 - the only way to get even CLOSE to this download speed on ADSL2+ means you have to be within 100m of the Exchange and be on brand new 0.6mm copper - which bugger all people have.

          Yes thank you LNP and Rupert Murdoch, I lay part of this 'Piracy' issue squarely on your shoulders.

    Oh dear. This is starting to get ugly.

      It may work for us. This is playing out just like the R18+ debate.

      Michael Atkinson stood in the way for over a decade but as more people talked to him the more he unravelled.

      If anything, this interaction with Village Roadshow is only further highlighting the already confirmed: distributors in Australia treat consumers with contempt.

      Even if we took away say Foxtel, our broadcasters have to secure the rights to movies and content from someone and often that is the local distributors who hold all the cards.

      There are problems with the current delivery models, don't get me wrong. But the heart of the problem is with the distributors (suppliers). And it's high time they either learned to adapt or die out and either let fresh blood in to replace them or have the sector replaced altogether with Internet based delivery models.

    Thoroughly slapped down. And with evidence to back it up, rather than nebulous assertions and emotive language.

    Well played, Mr Dalby. Time for a few dinosaurs to go extinct.

    A "delegation" of Australian actors have headed to Canberra to meet with George Brandis and Malcolm Turnbull:

    I'll stop "pirating" tomorrow if i get:
    - access at a reasonable price - when DVD/Video stores were still around, I used to pay $3 for new release titles, not $7. I have never paid $7 to hire a movie in my life.
    - ability to download the content, in HD quailty, free of DRM (or at the very least offline caching in an app with 1080p resolution), especially on smartphones/tablets
    - digital access to the TV/movies at the same time Americans get them - not the same time as cinema - the same time as americans can rent the same content

    Price, availability, offline access, that's what it's about. It's not that hard is it?

    Last edited 19/06/14 9:53 am

      Great. Why don't they just cut the crap and just send Oprah.

      I just googled who the hell these actors are. Let's just say that piracy is not any significant concern for them. At all.

      LOL'd @ one of the comments on that article: "piracy doesn’t affect the Aus TV/film industry, barely anyone DLs Aussie stuff which is demonstrated by the fact that not much of it is even available on torrents sites"

      Pretty much true.

        All the Australian TV content is available free of charge on "catch up" services when first released, and then on DVD later on, so there's no delay/access issues.

        Good anecdotal proof it's an availability/pricing issue, not a "we are all dirty pirates" issue.

      Hear, hear! I was very interested in the UltraViolet service, but the DRM limits you to their proprietary player. Half my machines run on Linux, and there's no player available. Looks like I'm staying with XBMC.

    In America, most of the ISPs are owned by cable/media companies (ie Time Warner Brothers), and even they cant police the internet the way Village Roadshow says it should. Yet, they come here making outrageous claims and demands to downgrade our rights to privacy, freedom of speech and fair justice.

    Australian Government should not be using Australian Tax Payers money to persecute Australian People for the sake of American interests. Havent they heard, our government doesn't have any money.

    Seeing Steve stand up to these ridiculous theories and accusations about piracy, and not be scared to publicly speak for the Australian consumer makes me very proud to be a happy long term iiNet customer.

    In the days of Dial-Up, I pirated music, but now I've moved my collection to Google play, and use spotify.
    I used to pirate PC games too, but over the last 9 years I have purchased hundreds of titles on Steam, rebuilding my entire collection legitimately.
    I still pirate TV and Movies because I don't have another option.

    My needs are simple:
    - One service for everything, I don't want multiple accounts with different companies.
    - The latest TV, kids shows, documentaries and movies, at 720p minimum, as soon as it's available anywhere else in the world.
    - I want to watch it whenever I want, once I have payed for it, It's mine and I can access that program/film anytime I want.

    I am happy to pay for this service, I don't even care if it's subjected to "Australia Tax".
    Let me give someone my money!

    On a side note. I've always found it funny that the only people that have to watch the old "You wouldn't steal a car..." clip at the beginning of DVD's are the ones that have already paid for it. Guys like Burke are only interested in a level field when they own the field and decide the winner. Themselves.

      Far out! I hate that! I've paid for the bloody thing, let me watch my damn movie! And if I did pirate, I wouldn't care about watching that ad.

      The best anti piracy ad I've ever seen was when I recently bought a movie and the first 45 seconds was a "thank you for buying me" montage of various actors saying thanks for paying for the movie. I think that would be many times more effective than the stupid "steal a car" argument.

        The least effective one I've seen was one specifically about harming the Australian film industry by burning the Happy Feet poster. It was particularly ineffective because it was on my DVD of 30 Rock.

      I definitely have growled very loudly in a cinema during one of their anti-piracy ads, "Oh for fuck's sake... Don't complain to US, we all paid an arm and a fucking leg to be here, assholes!" (There was mild applause.)

      Do they still do that? There haven't been any of those ads in the last couple years I've been. (Once every 6-9 months.)

      I wouldn't steal a car, but I don't mind making a copy of it....

    Holding ISPs responsible for the illegal behaviour of their customers would be like holding Holden or Main Roads responsible for the illegal behaviour of drivers. We don't send the bill for catching drunk drivers/speeders to car manufacturers, we have a police force who handle enforcement of the law. And they get a budget to do that. To tell ISPs it's their job to catch infringers is both figurative and literal buck-passing.

    If the government's going to insist on this idiocy, they should also budget to provide funds to the ISPs to handle monitoring/enforcement. Because that shit DOES cost money, and if the government doesn't want to pay to catch cyber-criminals the way they pay police to catch any other criminal, the cost of doing it will be passed on to the consumer. Which is bullshit.

      Holding ISPs responsible for the illegal behaviour of their customers would be like holding Holden or Main Roads responsible for the illegal behaviour of drivers.

      Or my personal favourite, it's like holding Tim Shaw liable for knife crimes.

        But wait - there's more!

          Is it even possible to *not* say that when mentioning him?

          Thanks for the laughs.

    We're behind you 100% Mr. Dalby. These backwards-arse politicians and media moguls need to learn that piracy is a symptom of a larger problem, not the problem itself.

    On a related note, in the highest form of hypocrisy and irony, that ad that he alludes to - the MPAA's "You wouldn't steal a car..." - actually used stolen music :P. It turns out the guy who wrote it, a Netherlands composer called Melchior Rietveldt, was told only that it would be played once at a local film festival or something. A year later he happened to watch a DVD with that ad on it and was rather surprised to find his music on it, without his permission. Long story short, the royalty collection agency tried to pull a shifty on him (after 6 years of arsing around about it as well), but he happened to record the conversation with the guy making the offer, who then had to resign. So basically, the media industry is only too happy to scream blood murder about protecting Copyright, except when it inconveniences them personally. F*cking hypocrites.

      On a related note, in the highest form of hypocrisy and irony, that ad that he alludes to - the MPAA's "You wouldn't steal a car..." - actually used stolen music :P

      HAHAHA! Very true. Not many know that.

      The other problem with the ad itself was the terminology was incorrect. It claimed piracy was stealing when it wasn't.

      Last edited 19/06/14 11:00 am

      and its the same piracy message they have been playing since the 1980s... ever since Twin Deck Ghetto Blasters and VHS Cassette recorders. 35 years plus and the music, movie and television industry is still here and kicking us with the same old message, crying poor while counting offshore billions in dollars in their bank accounts.

    I will be a iiNet Customer for life if they continue to work with there customers like this. Go iiNet

    Ok, time to call out Dalby on a bad argument too (as I did with Burke on his):
    Mr Burke also shows his ignorance of the ISP revenue model. Not only is he totally wrong, but I think he fails to be outrageous. The ISP subscription model, commonly in place in Australia, does not charge by the download, as he suggests, it is a fixed fee per month. In that model ( a bit like gym membership) the less data a customer uses, the more profitable they are.

    ISP subscriptions vary in price based on data allowance, so although it is entirely true that the profit will be higher on a low-traffic user than a high-traffic user if they are on the same plan, if the low-traffic user is using a lower-traffic plan then this may not be the case. (Note: depending on overheads, plan price differences, and so on it may still be that the profit is higher on a low-traffic user but it is not true that there is no relationship between plan cost and data traffic).

    That said, I don't think that the data allowance argument favours either side for reasons I explained in a comment on the previous post.
    ... if people were streaming from legal online services, then they would still be consuming large quantities of data and they would still need to be obtaining that data through an ISP. If consumption dropped due to the need to purchase (i.e. people stopped buying because of the cost) then data use would drop and the ISPs could be worse off. However, that would put paid to the argument that a pirated copy is a lost sale, because if each pirated copy was a lost sale the number of downloads wouldn't drop - just the source would (from a pirate source to a legal source). Indeed, if current piracy-related traffic were all converted to traffic from legitimate sources then the ISPs would be much better off because they would be able to either have peering arrangements with content providers (reducing the amount of international traffic and thus costs), or internally host streaming servers (as Netflix does with some ISPs in the US) and then that traffic wouldn't leave their network at all - the ultimate in cheap data.

      >> data use would drop and the ISPs could be worse off.

      Sorry. That's not right for iiNet and I suspect not right for most Australian ISPs.
      As I've said previously, and as we proved in court, customers that use less data are more profitable. I'm sure you can build a tiny set of exception cases at changeover points on a graph, but they are exceptions.

        Thanks for the response and clearing up the relationship between profit margin and data use. I think I had my cynical spin-analysis hat on.

        I have used iiNet for years, and continue to despite my pretty shabby SNR (due to a bad phone line). It is the fact that iiNet is actually willing to get involved in these battles that makes me continue with them rather than switching to either Optus or Telstra HFC.

        Edit: cut out pointless discussion of semantics

        Last edited 19/06/14 2:47 pm

        To police its users, they would have to install hardware, new software, new staff, processing power... which is overheads and costly.... so they can turn around and use that information to LOSE customers by banning them from their service.

        ... and the end of the day either your Internet costs will go up to offset this and/or government will raise taxes, cause Village Roadshow (Apple, Fox, Universal, Sony....) be paying a cent to police this as they float all their profits to their American Masters.

        and at the end of the day, the real criminals will just find better ways to hide their activity, while Mr Jones and his family of four cant access the internet as he got banned cause he didn't password protect his WiFi and a neighbour down the road leeched his wireless internet and blew his download limit on pirate handicam cinema cuts of the latest movies filmed in Russia or Asia somewhere.

    A Great little video on Copyright Math, very entertaining and informative .

    why do they need to create a legislation about online piracy if even the biggest nation is not yet successfully about copyright etc. copying data / information from a legit purchase from another doesn't necessarily inflict a tangible lost.

    Posted this on the other topic, thought I'd repost here...

    On the subject of Blockbuster Video and market failure. Has anyone heard Nokia or Blackberry blaming the telcos for failing to sell their 'stuck in the last decade' technology (yes, I know they both still exist, but they're shadows of their former glory)? How much sympathy do you think the market had for Cobb and Co when the automobile began to roll over the top of them? I know my grandparent's candlestick maker was very upset when they decided to install that new fangled electricity in their home.

    History is littered with overrun empires, technologies and markets. From Rome and the British empire, to IBM's OS/2, Lotus' 123 (or Visicalc for that matter), tape recorders (Video and audio) and charging extra for long distance phone calls.

    Resistance is futile.

    I think they (the old folks) are looking at it the wrong way.

    If Graham Burke is interested in getting more people to the movies. Why not offer some incentive - you pay to watch the movie upfront, Then immediately after you watched the movie. You have the option for an additional -$10 you get a voucher to down load the movie when its released digitally.

    Sure they may make less money on the down load but better to make some money then no money, and everyone wins. People have an incentive to go to the movies.

    Village Roadshow Ltd
    As at June 30 2013
    Revenue: A$908.5M
    Gross profit: A$584M
    Salary Co-CEO Graham W. Burke: A$3,927,381.00
    Salary Co-CEO Robert Kirby: A$2,656,630.00

    iiNet Ltd
    As at June 30 2013
    Revenue: A$940M
    Gross profit: A$303M
    Salary CEO David Buckingham: A$1,032,436.00

    To paraphrase Smith in Shoot 'em Up, Never trust the people who stand to profit most, plain and simple. They're the bad guys.

    Iinet is known to net telling the truth in public for e.g

    Iinet deliberate mislead about not being worried about Telstra buying adam , the hypocrites Iinet put in a complaint to accc about telstra buying adam, saying it would reduce competition

    yet the iinet buys adam , reason why i will not bother waste my time with any company who iinet has brought

    Village Roadshow is never going to win this argument. In a genuinely free market people would always pay a fair price because the supply and demand would be properly balanced. Oversupply usually means lower prices, and under supply higher prices. Under supply means any limitation on availability. In Australia it is usually under supply causing inflated prices when the reasons for the under supply are artificially created, ie. created deliberately by the suppliers. So, here in Australia supply is rarely balanced with demand, and so consumers a) don't pay a fair price, b) look elsewhere for suppliers to satisfy their demand, and c) stop responding to suppliers expectations.

    So as a direct consequence of this market manipulation, a) we usually pay too much, b) we find other ways of satisfying our demand, including but not limited to piracy, and c) we either stop buying and/or tell the suppliers we're not happy with their service.

    In short, Australia doesn't have free markets for most imported products, particularity entertainment & high tech products. Suppliers continue to over charge us, and still expect us to believe that there are legitimate reasons for doing so. No wonder Australia is considered to be such an expensive country - this is why.

    We are not stealing a car, or a hand bag and we are NOT stealing a movie, we only want to watch the fekkin' thing. Movie moguls are multi-millionaires, so are actors and actresses, and we in Oz fork out big time money for a DVD or the movie theatre.
    Aussie seems to be a money tree for American companies when we are charged far more in a dollar value than their own countrymen.....(Movies, Woolworths & Coles for starters!)

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