Wanting less News: Pay TV piracy and News Corp

If there was any doubt that News Ltd have too much power in Australia, it should be dispelled by their aggressive handling of the allegations of global Pay TV piracy this last week. The issue was launched internationally by a BBC Panorama program called “Murdoch’s TV pirates” and it was given a local angle with long time Murdoch tormentor Neil Chenoweth’s series of articles in the Australian Financial Review (Chenoweth was also an adviser to the BBC program). News Ltd has tried to bully the AFR out of their allegations while also questioning SBS for showing the documentary hinting it does not correspond with the station’s code of practice.

The Panorama program focussed on a British issue. It alleged the then News Corp security arm NDS (headquartered in Israel) hired an expert team of Pay TV hackers from the piracy site called The House of Ill Compute (THOIC). Originally known as News Datacom Systems, NDS established the “Operational Security” group in the 1990s to ensure the security of Murdoch’s growing pay TV interests. Cracking codes is not illegal but spreading the cracked code to encourage piracy is. NDS busted THOIC piracy but instead of prosecuting them they hired them. The THOIC brief was to open up the security codes of NDS competitors, Canal+ (from France), and flood them on the market. This action, Panorama said, was directly responsible for the death of On Digital (later called ITV Digital) which used the Canal+ system. On Digital was the biggest pay TV threat in the UK to Murdoch’s BSkyB which had smartcards made by NDS.

Panorama tracked down Lee Gibling, the former head of THOIC who told them NDS hired him to break competitors’ smart card systems. Panorama also secretly filmed two other key witnesses, former NDS employees Ray Adams (previously Metropolitan Police commander) and Len Withall and aired the footage without their permission. The footage found evidence that emerged in 2002 showing links from THOIC to News Corp. Canal+ sued News Ltd who dealt with the problem by spending $1 billion on an Italian Pay TV company called Telepiu, owned by Vivendi Universal which was on the brink of bankruptcy. Vivendi Universal also owned Canal+. The terms of the deal was to drop the lawsuit and the Canal+ Tech team that developed the smart cards was also disbanded.

Here in Australia, the AFR published the end of what they called “a four year investigation” into similar allegations into the local pay TV market. They published an archive of 14,400 Ray Adams emails and said piracy cost Australian pay TV companies $50  million a year at its height in 2002. It helped cripple the finances of Austar, which Murdoch’s part-owned Foxtel (which uses NDS) is now buying. The AFR published emails which were submitted in legal cases brought against NDS by rival pay TV operators in the US (DirectTV, Echostar) Europe (Canal+ and Sogecable) and Malaysia (Measat). Like the way they dealt with Canal+, News Corp bought 34 percent of DirectTV to end that case. In the only one to go to trial, Echostar won three of six counts, but won only minimal damage and had to pay court costs.

In Australian law, unauthorised access to electronic networks and illicit modification of databases are criminal offences. But Bruce Arnold, Law Lecturer at the University of Canberra, is only prepared to say News Corp may have exacerbated the issue. “Academic and industry research over two decades indicates the problems experienced by the defunct or ailing television networks were primarily attributable to poor management, poor marketing and inadequate capitalisation,” Arnold said.

Finding hard evidence is not easy, as Terry McCrann alluded to when hauled out by the Herald-Sun to defend News. McCrann wanted to see an email quoted in the AFR. “You know, something like: Murdoch to 007: My plan for world pay-TV domination rests on your piracy skills. Let's target one million pirated cards by Christmas.”

McCrann was flippant but giving the nastiness at the heart of News Corp exposed in the Levinson Inquiry, it not beyond the bounds of reason to think Murdoch wanted to see exactly that: one million pirated cards on the marketplace by Christmas. Such thoughts never make it to an email. Britain’s TV regulator Ofcom is currently examining if Rupert and James Murdoch are “fit and proper” to be in control of BSkyB based on the phone hacking scandal. One of the hacked MPs Tom Watson says the pay TV allegations should be added to that investigation.

Here the ACCC (Australian Competition and Consumer Commission) is reviewing the $1.9 billion Austar takeover bid. With such a cloud over the Empire, it seems beyond belief the Australian Government should allow yet another contraction of ownership in the most concentrated media landscape in the western world. Yet time after time, Murdoch gets his way in Australia. Robert Manne explains why this is a problem: “The more the media is concentrated, the greater is the problem for the health of democracy”, Manne writes. “Yet the more the media is concentrated, the less likely it is that the issue will be debated freely in the only appropriate forum for the discussion, the media itself.” News Ltd Australia should be broken up, not expanded.

Internet Industry Association gets involved in iiNet downloads case

The Internet Industry Association (IIA) has made an application to become “friend of the court” in an upcoming legal battle between copyright groups and an ISP over illegal downloading. While APC could be said to be a bit extreme in saying this civil action could “shut down the Internet” the outcome of the case could nevertheless have significant ramifications for online usage in Australia. The industry body Australian Federation Against Copyright Theft (AFACT) is alleging the ISP iiNet infringed copyright by not preventing customers from downloading pirated material.

Because of the potential knock-on effects, the IIA, which represents the wider Internet community as well as ISPs, has applied to be amicus curiae, a ‘friend of the court’. Though it has yet to make a submission, AFACT has opposed the application because it thinks the IIA will be biased because iiNet is a member. (photo by Harry CC BY 2.0)

AFACT took the initial action in November last year claiming iiNet ignored repeated notices which identified thousands of illegal file transfers over their network. These included movies such as "Happy Feet" and "I Am Legend" which users obtained using BitTorrent peer to peer technology. iiNet’s managing director Michael Malone called it an unfounded allegation and said it was not their job to police traffic on their network. “If someone is breaking the law, let the police and the courts do their job,” he said.

The case shows that the industry wants to turn the screw on ISPs to stop illegal downloads and is starting with the easy-to-handle small fry. iiNet says it does not support piracy in any form but it would be naïve to believe it is not common. According to the ABS just 30 percent of all Australian users were on Broadband in 2005, but three years later that figure had risen to 84 percent. With faster Internet connections now the norm, downloading content has never been easier or more commonplace.

Copyright owners cannot directly identify infringers but can identify IP addresses. Once identified, they send infringement notices to providers. But Australia does not have blanket agreement between content companies and broadband providers about file swapping. While some ISPs such as Optus forward infringement notices to customers, others like Telstra ignore them completely. According to Malone, iiNet is in the active camp and passes along each complaint to state police who share the building with the ISP. He says what AFACT wants his company to do is impossible. They cannot act on allegations against customers. "AFACT seems to expect ISPs to be judge, jury and executioner here", said Malone. "We are meant to take their unfounded allegation, then cut customers off.”

According to digital media academic Tama Leaver, the case will test the safe harbour provisions which were brought in during the recent Free Trade Agreement with the US. The provision provides some immunity for ISPs when providing carriage services. The law limits remedies to infringements when transmitting, hosting, caching or referencing information according to Division 2AA of the amended 1968 Copyright Act. But AFACT are claiming iiNet are in breach of sections 115 and 116 of the Act (immediately prior to Division 2AA in the Act) which are the provisions which deal with infringement of copyright.

AFACT is the film industry’s enforcer to act on piracy claims. According to its website, its heavy hitting members include Village Roadshow, Walt Disney, Paramount, Sony, News Corp, Universal and Warner Bros. All these companies are listed as plaintiffs in the matter alongside the Seven Network. They have asked the court to order iiNet to act to prevent the continuing unauthorised use of their material by customers. It says piracy results in lost jobs, and limits investment in new programs and films, as well as in new technologies which benefit consumers. The presiding judge will make a decision on the IIA’s amicus curiae application in the coming weeks and the Federal Court trial will commence 6 October.

This case will be well worth following because of how it might affect the copyright law faultline between the rights and benefits of authorship and the general public’s right to enjoy created products.

Hew Griffiths sentenced in US court

Australian software pirate Hew Griffiths will spend over a year in a US prison after he pleaded guilty on Friday on a charge of conspiring to commit a criminal copyright infringement. Judge Claude Hilton of the US District Court in Alexandria, Virginia, sentenced Griffiths to 51 months jail. However the judge reduced the sentence to 15 months after he took into account three years Griffiths spent at Silverwater detention centre in NSW fighting extradition.

Griffiths is a 44 Briton who came to Australia with his family when he was seven. He has a British passport and never applied for Australian citizenship. Griffiths was controversially extradited to the US in February. He is the first person to be extradited from Australia to the US to face intellectual property charges. Griffiths had never set foot in the US before this time. He faced a maximum sentence of up to 10 years in prison and a US$500,000 fine for the charges. His Australian pro bono lawyer, Nicolas Patrick of DLA Phillips Fox, said he would investigate prisoner-exchange options that might allow his client to serve his sentence in Australia. Patrick also claimed the sentence highlighted the "injustice of this process" as Griffiths would have served a much shorter sentence had he been tried in Australia.

Griffiths admits he was the brains behind several counterfeit software rings called DrinkOrDie, Razor1911 and RiSC. DrinkOrDie is a network which copied software, computer games, music and videos worth $50 million. As far back as 2001, the US Customs Service was calling the group “the al-Qaeda of Internet software theft” and "the oldest and most well known" of Internet piracy organisations. Founded in Russia in 1993, it expanded internationally throughout the 1990s until it was broken up by US Immigration and Customs Enforcement in December 2001, with more than 70 raids conducted in the US, the UK, Finland, Norway, Sweden and Australia.

DrinkOrDie is a software cracking site known in its own jargon as “warez sitez”. “Warez” (pronounced either like “wares” or like the city of “Juarez”) is software that has been stripped of its copy-protection and made available on the Internet for downloading. They distributed software from computer giants like Microsoft, Adobe Systems and Symantec, as well as smaller software vendors. The group used encryption and other security measures to hide their activities from police. Bob Kruger, of the anti-piracy Business Software Alliance trade organisation said DrinkOrDie was at the forefront of piracy. "They are a notorious elite Internet pirate organization," he said. "I doubt there's much (software) out there that people want that (DrinkOrDie) can't provide."

According to Alice Fisher, a US Department of Justice assistant attorney general, Griffiths became one of the most notorious leaders of the underground Internet piracy community by orchestrating the theft of hundreds of thousands of dollars in copyrighted material. Griffiths, who used the alias “BanDiDo”, became involved with DrinkOrDie in the 1990s and he himself earned nothing from the piracy.

After 11 members of the group were arrested and charged in the US, they started to chase down Griffiths. They alleged he was one of the few who controlled access to the drop site at the Massachusetts Institute of Technology. They had Australian police arrest Griffith in August 2003 on copyright charges. He was held in custody for two months until bail was granted. He came to trial in March 2004 however Australian magistrate Daniel Riess threw out the charges saying there was no extraditable offence. The US won an appeal against the decision in July 2004. Justice Peter Jacobson ruled that magistrate Riess had "misdirected" himself, possibly because he held the view that the alleged crimes had been committed in Australia when case law and the indictment showed it was committed in the US.

Griffiths' appeal to the Full Federal Court was turned down in March 2005 and his special leave application to the High Court was refused that September. Griffiths' lawyers at the NSW Legal Aid Commission then wrote Justice Minister Chris Ellison asking him to exercise his power to refuse the US request. After eight months the Attorney-General's Department drafted a submission to the minister refusing the request. Ellison finally issued a warrant for Griffiths' extradition to the US and he was flown out in May this year.

Critics of the Griffiths case have called the Australian government action craven in the face of American pressure. They have pointed out he could have been charged in Australia and that the UK did not hand over any of their DrinkOrDie suspects. Many have likened Griffiths' treatment with that of convicted Guantanamo detainee David Hicks. Others have warned that criminal prosecutions for intellectual property (IP) violations will increase as a result of Australia's Free Trade Agreement with the US. David Vaile of the Cyberlaw and Policy Centre of UNSW believes the "overreach of American power" produced an FTA that was "unbalanced". "It was a partial harmonisation with only those parts of American law that favoured certain interests," he said.

Meanwhile Australian judicial opinion is that while copyright infringement, particularly on a large scale, is clearly wrong, extradition seems disproportionate. Griffiths’ lawyer Nicolas Patrick claimed his client was the real victim. "Effectively my client was sent to face charges in a foreign country where he has no knowledge of the legal system and no friends or family," .he said "He has been surrendered to a country where the penalties for such offences are much harsher." With no Australian citizenship to protect him, it is possible he will be deported from Australia after he completes his sentence.

Talk the Plank

Today be the fifth annual International Talk Like a Pirate Day. People worldwide are urged to get in touch with their inner buccaneer and speak pirate for the day. The idea originated in 1995 when two friends from Oregon, John Baur ("Ol' Chum Bucket") and Mark Summers ("Cap'n Slappy"), proclaimed 19 September each year as the day when everyone in the world should talk like pirates. The date was selected because it is Cap’n Slappy’s ex-wife’s birthday and therefore easy for him to remember. The idea remained a private joke until 2002 when the duo wrote a letter to American humorist Dave Barry. He liked the idea and popularised it in his syndicated newspaper column. The idea quickly spread internationally.

There are several basic rules that must be observed in order to talk like a pirate. Firstly one must double up on all adjectives in order to achieve the correct level of over-enthusiastic bombast. A few letters of the alphabet are dropped such as the ‘g’ that ends present participles such as in sailin’, rowin’ and fightin’. The letter v is also omitted in words like ne’er and o’er. Pirates always speak in the present tense and say “I be” rather than the more formally correct “I am”. Pirate conversation is, of course, strictly nautical – landlubbers need not apply. But the single most defining feature of pirate talk is the long drawn out ‘arrr’ that acts as a sentence substitute as well as having a multitude of other uses. Even if a would-be pirate has mastered nothing other than ‘arrr’, he (pirates of both sexes are male) is well on the way to the sailor nirvana known as Fiddler’s Green where unlimited supplies of rum, women and tobacco are provided.

Of course, this is pure Hobsbawm – an invented tradition. Pirates never talked or acted like that but Robert Newton did. Newton was an English character actor who died in 1956. His most famous role was Long John Silver in Disney’s Treasure Island (1950). Stevenson’s original novel, a tale of "buccaneers and buried gold," provides much of stereotypical pirate culture. The shanty Dead Mans Chest is from the novel. Silver used the misquoted oath “shiver my timbers” seven times in the novel. Newton was born in Dorset which is not far from the famed Cornish smugglers coast. He provided his native accent to lend “authenticity” to the role of Long John Silver and added blandishments of his own to make the character larger than life. And it was his faux-Cornish delivery in the film which gave ‘arrr’ to the world.

Unlike the relative newcomer ‘arrr,’ piracy itself is as old as sailing. The word pirate comes from the Greek word “peira” (attack) and the earliest recorded pirates were the Anatolian Sea People who terrorised the Mediterranean around 1200 BC. Real pirates still exist in many parts of the world today and piracy is on the increase. In November 2005 the cruise liner Seabourn Spirit was attacked off the Somali coast by pirates in speed boats. The captain managed to change the course of the vessel and sped away without incident. The UN International Maritime Organisation (IMO) were aware of 27 pirate attacks off Somalia alone in the 12 months leading up to the Seabourn Spirit incident. These include the commandeering of two vessels used by the U.N. World Food Programme bound for Somalia. The Straits of Malacca off the coast of Singapore is another piracy hotspot. The Strait is the busiest waterway in the world with 65,000 vessels annually plying its waters. Malaysia, Indonesia and Singapore have begun to co-ordinate maritime and air patrols to curb piracy. As a result there has only been three sea robberies in the area in the first half of 2006, down from 18 cases for the whole of last year and 38 in 2004.

The threat of international piracy is so strong that the IMO have issued a guideline to ship operators called “Piracy and Armed Robbery Against Ships". The document has chilling hints for crew members working aboard ships such as point 33 “(they) should avail themselves of shadow and avoid being silhouetted by deck lights as this may make them targets for seizure by approaching attackers” and point 57 “in the event that attackers gain temporary control of the ship, crew members...should leave CCTV running.” Piracy is no joke on the high seas. Shiver their timbers.