The victory that the AFL scored against Optus in its battle to stop the telco from enabling users to view recorded sporting events via the mobile phone network could have a serious long-term negative effect on that sporting organisation – the victory could ultimately turn into a defeat.
While the Federal Court might be right in ruling that Optus is actually doing the recording, and not individual users, and that as such the company is in breach of copyright, the reality is that the technology to record such events on mobile phones, tablets and smart TVs will allow for the development by some of the world’s two million application developers of new applications that enable users to do so directly, and in accordance with the ruling.
So, whether it is Optus or millions of individuals doing this, the end result for the AFL and other sporting codes will ultimately be the same. Most, if not all, of their traditional business models will need to be reviewed and changed in the wake of these developments – otherwise they will become yet another casualty on one of the information highways.
In our previous comments on this topic BuddeComm has questioned the effects of these recording services on the traditional sporting services. It is unlikely that users are going to gather en masse around smartphones to watch these games, so in that respect the value of the rights that Telstra bought will not be affected. Instead this application is an add-on, an opportunity for extra revenue, rather than one that is competing with their other services.
Nevertheless the long-term implications of new technologies will have an effect on the traditional services, with or without court rulings. Rather than wallowing in the false security of the ruling, content providers should start looking at the opportunities that are now becoming available through the use of new technologies and begin to explore potential business models around them.
The music industry is an excellent example. The traditional industry was devastated by the onslaught of the digital economy. It refused to adapt and entered into all sorts of legal battles trying to protect its traditional market. Ultimately it failed. In the meantime, those prepared to look forward rather than backward began to develop new models and since last year the music industry is – for the first time in close to a decade – growing once more.
And in the process Apple has become one of the largest players in this market, with 220 million iTunes users.
It will be impossible for any industry to stop the flow of technology and, rather than fighting it, they should start looking at how they can adapt and develop new revenue streams. So far no sector has been able to successfully stem the tide – there are plenty of examples in newspaper publishing, telecoms, the film industry, broadcasting, retailing and others that can be learned from.
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