Consumer use of copyright material

3.23 The Terms of Reference for this Inquiry direct the ALRC to consider whether the Copyright Act needs reform to allow:

• transformative, innovative and collaborative use of copyright materials to create and deliver new products and services of public benefit; and

• appropriate access, use, interaction and production of copyright material online for social, private or domestic purposes.

3.24 Many stakeholders agree that law reform should be driven by a desire to ‘provide certainty, promote accessibility and maintain the relevance of the law’.^[23] Choice warns that the content industries are ‘by and large playing catch-up’ with changes in technologies and consumer behaviour.^[24]

3.25 Clarifying which activities infringe copyright now, and whether certain activity should continue to be categorised as infringement, is part of this Inquiry. This context is an integral part of reform discussions taking place around the world. In the EU, for example:

Citizens increasingly voice concerns that copyright laws hinder what they view as their freedom to access and use content. Experience shows that many of them would rather pay for legal offers than use illegal content, but they often do not know whether what they download, stream or share is illegal. Businesses increasingly argue that the current copyright model is a barrier to developing the business models they consider necessary for the digital economy. These consumers and businesses agree, for different reasons, that copyright rules have to be made more flexible.^[25]

3.26 In Australia, the House of Representatives Inquiry into IT Pricing noted that consumer perceptions of copyright law as unfair ‘can generate infringement and undermine the copyright system as a whole’.^[26]

3.27 In his book, Making Laws for Cyberspace, Chris Reed points out:

Attempting to impose rules which clash with strongly established norms, or making law in such detail that the cyberspace user is not able to understand or comply with it, are not the only ways in which laws can be rendered meaningless. Law needs to regulate the reality which is faced by those who are subject to the law.^[27]

3.28 The ACCC referred to ‘consumer empowerment over consumption’ where consumers wish to organise use of copyright material around their own preferences in terms of time, location and method of consumption.^[28] This could lead to a situation where

worthy individuals and citizens, many of them children (some maybe even judges), are knowingly, ignorantly or indifferently finding themselves in breach of international and national copyright law. And they intend to keep on doing exactly as before.^[29]

3.29 ACCAN observed that:

Currently multiple everyday activities without any commercial implications are likely to breach copyright. Indeed, many consumers would be surprised to learn they were breaking the law by privately copying and recording in a way that has been commonplace for decades and in using devices that have been marketed to them vigorously.^[30]

3.30 Some stakeholders expressed concern about the extent to which consumer attitudes and practices may influence law reform.^[31] In this context some stakeholders stated that it is preferable for law to shape consumer behaviour, rather than for consumer behaviour to shape the law.^[32] This would include educating consumers about copyright and ‘why the legislation is in place’.^[33]

3.31 Laws that are almost universally ignored are not likely to engender respect for the more serious concerns of copyright owners: ‘[p]eople don’t obey laws they don’t believe in’.^[34] The Australian Research Council Centre of Excellence for Creative Industries and Innovation submitted that research indicates:

The wide gap between law and norms in terms of private use is not desirable for copyright law. It is possible that widespread, pervasive disregard for copyright rules in terms of private use may support a broader legitimacy problem in copyright. It seems clear that the gap between social norms and the law should be reduced where possible.^[35]

3.32 The Australian Communications and Media Authority (ACMA) has conducted research which shows that Australians are

pragmatic about the limited capacity to regulate content distributed over the internet and, with the exception of illegal content, expected that much of the content available online would not be regulated. These expectations may be helpful in framing individual rights and responsibilities for copyright material.^[36]

3.33 Not all infringing behaviour is regarded as ‘piracy’ or ‘theft’.^[37] The Chief Justice of Australia, the Hon Justice Robert French, has stated that ‘messages equating copyright infringement with theft do not always compute’ due to ‘the difficulty in trying to attach a moral purpose’ to laws that do not make sense to people.^[38]

3.34 There is clearly an understanding among stakeholders that some infringing use of copyright material is ‘fair enough’^[39] and other use is more egregious. There is also a distinction between consumers who may (or may not) erroneously believe that certain practices constitute copyright infringement, and those who would blatantly infringe, steal or engage in piracy.^[40]

3.35 One way of taking consumer preferences into account is through market responses in providing copyright content as consumers wish to consume it. The ALRC is aware that new services and business models are increasingly meeting consumer demand for some types of personal use, for example format shifting and time shifting.^[41] Indeed, the digital environment creates new market opportunities and ‘more sophisticated, flexible and efficient means for companies to measure and charge for usage’.^[42]

3.36 As discussed in Chapter 2, a framing principle for this Inquiry is recognition of the role of copyright as an incentive to creation. The ALRC does not intend in any way to undermine property rights or a fair reward to copyright creators, owners and distributors. However, questions of recognising ways in which individuals use and communicate ideas and experiences, without damaging the economic interests of the copyright owner, are relevant and have been taken into account in reform recommendations.