AFACT fight costs iiNet $4 million
- 25 November, 2009 12:45
- Comments 9
The legal stoush between the Australian Federation Against Copyright Theft (AFACT) and iiNet (ASX: IIN) will cost the ISP $4 million.
In a presentation to shareholders at its annual general meeting, iiNet predicted its underlying earnings for the 2010 financial year to hit $80m – a 19 per cent year-on-year increase. The company has, however, set aside a net $4m one-off legal cost from the estimated growth figures.
The ISP has been battling a copyright case in the Federal Court brought forth by AFACT, which represents a number of high-profile Hollywood movie studios. The group has accused iiNet of allegedly turning a blind eye to piracy by subscribers on its network and therefore authorising illegal activity.
“We firmly believe that the legal action by AFACT was an ambitious and adventurous attempt to extend liability for piracy to Internet services providers who merely provide infrastructure and facilities for customer use,” iiNet said in a statement. “iiNet has not infringed, nor condones infringement or illegal activity of any sort.”
iiNet expects 2010 first-year revenue to reach $224m and underlying net profit to hit $14m. That is an increase of 9 per cent and 27 per cent respectively compared to the first half of 2009.
The figures factor in a marketing fund increase of $4m for further growth in Perth, Sydney and Brisbane, as well as its debut in the Melbourne market.
In August, iiNet reported a profit jump of 28.8 per cent to $25.6m in its preliminary 2009 financial report.
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Comments
Hyding
$4M is nothing
imagine the lost earnings from those that had their copyright infringed upon.
The writers of music, the producers of films, the bit part actors.
Not just the studio's.
Anonymous
$4m is nothing
Your comment is not really relevant to the case.
The problem is the amount of money the studios pay themselves and their star actors.
The studios insistance that people pay too high a price makes piracy worthwhile.
If the greedy studios simply followed the itunes model they'd make a lot more money and there'd be a lot less piracy.
Going after a third party for damages because they can't manage their own business is ridiculous.
I hope iiNet wins and get their costs paid for by the studios.
clutrz
re: $4M is nothing
Then AFACT should be chasing down the individual offenders and taking them to court rather then trying to force a utility provider to take on the effort (and cost) of doing so on their behalf with no monetary compensation.
steve
"$4M is nothing"...."underlying net profit to hit $14m." So 4 million out of total profit of 14 million in 2010, I make that roughly 30% of total net profit. So because studios believe they are losing out on profit due to copyright infrigement they should make other innocent people also lose profit, intersting argument.
"imagine the lost earnings from those that had their copyright infringed upon."....Every independant study of the matter has come up with zero evidence that copyright infringement=loss of earnings. A person infringing copyright to download a film doesn't automatically mean that the studio etc has lost that $40+ of profit, if there was no intention on the persons behalf to ever buy the film then there was 0 loss of profit.
Equating the number of downloads to the amount of lost profit is a simplistic equation at best, and misleading at worst, just a tool to inflate the imagined revenue loss to fool gullible members of the public, looks like it works as well.
Anonymous
Poor old hollywood
RE: "Think of all the writers and performers that lose out"
Those people already got paid. Anyone who accepts a deal that involves getting a cut of a movies profits, and not an outright sum of money is one that doesn't get paid EVER, forget about piracy.
The term: "Hollywood Accounting" was invented due to the practice. Many movies make a net-loss because it saves someone tax, or they don't have to pay various stakeholders somewhere along the line. Regularly people are screwed over by this practice.
Famous example is the writer of "Forest Gump", good movie right? should have made millions right? Nope! movie made a loss! and the writer who had a "cut of profits" deal, made nothing! That is the reason why the sequel to Forest Gump never got made into a film, the writer got burnt.
See: en.wikipedia.org/wiki/Hollywood_accounting for more tales of the poor hollywood studios (and the ways THEY actively screw their own content producers).
Anonymous
lol
4M is something to a ISP provider who is there to provide legit services to businesses and consumers.
For those that believe, that 4M is nothing compared to what writers, producers and so on, get this, compare apples with apples.
If you want something done, do it your bloody self.
You can't compare an ISP (retailing legit services) with someone like Kazaa (copyright infringement etc).
Som Ting Wong
maybe
may be the police should be chasing car manufactures for speeding fines instead of the owners. car the manufactures are providing the means for people to speed.
or they should chase toll road owners for speeding fines for people that use the roads and speed.
same thing isn't it?
watch out Optus and Telstra they are next.
Fairtrade
The average carpenter or tradesman earns around $70k - $80k, in which they live comfortably and support a family.
An actor earns 50 times that, you're right, $4 million is nothing in their eyes.
Anonymous
well.
cars can go faster than the speed limit, are car manufacturers liable becuase they enable the car to go well over the speed limit? They cap it around ~200km/h on most cars...
also why would they still make films if they weren't profitable? YEAH AFACT YOU LIEING BASTARDS. and to every similar organisation in the world, your not losing ~18bn a year, your just not getting it. afact keep making it out as the film industry is not profitable, so why the hell are they making movies still?
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