EXECUTIVE SUMMARY

This submission draws upon a number of pieces of research on copyright and consumer rights – including:

1. Matthew Rimmer, 'Clash of the Titans: Apple, Adobe, and Microsoft Under Fire at the IT Pricing Inquiry', The Conversation, 22 March 2013, https://theconversation.edu.au/clash-of-the-titans-apple-adobe-and-microsoft-under-fire-at-it-pricing-inquiry-12878

2. Matthew Rimmer, 'When the Price is Not Right: Technology Price Gouging in Australia', The Conversation, 23 November 2012, http://theconversation.edu.au/when-the-price-is-not-right-technology-price-gouging-in-australia-10582

3. Matthew Rimmer, 'IT Pricing: Copyright Law, Consumer Rights, and Competition Policy', A submission to the House of Representatives Standing Committee on Infrastructure and Communications Inquiry into IT Pricing, 19 September 2012, http://works.bepress.com/matthew_rimmer/121/

In addition, this submission draws upon a number of pieces of community outreach, including media comments:

4. Kim Landers, 'ANU Academic Matthew Rimmer Discusses Parliamentary Report into IT Pricing', ABC News 24, 29 July 2013, http://www.abc.net.au/news/2013-07-29/4851168

5. Harrison Polites, 'IT Price Gouging a Potential Election Issue', Business Spectator, 30 July 2013, http://www.businessspectator.com.au/news/2013/7/30/technology/it-price-gouging-potential-election-issue-expert

6. James Hutchinson, 'Push to end Technology Price Gouge', The Australian Financial Review, 30 July 2013, http://www.afr.com/p/technology/push_to_end_technology_price_gouge_Qb63sMRqwyOZd1jHDsT5qL

7. ABC, 'Parliamentary Report Urges Australians to bypass online Geo-Blocks that can Double Prices for IT Products', ABC, 29 July 2013, http://www.abc.net.au/news/2013-07-29/geo-blocking-mps-committee-price-report-apple-adobe-microsoft/4850484

8. Rebecca Nash, 'The Great IT Rip-Off', The Business, ABC TV, 12 April 2013, http://www.abc.net.au/news/2013-04-11/the-great-it-rip-off/4624396

9. Jonathan Pearlman, 'IT Giants Grilled Over High Aussie Prices', The Straits Times, 30 March 2013.

10. John Hilvert, 'Could Geo-Blocking be deemed anti-competitive?', IT News, 26 March 2013, http://www.itnews.com.au/News/337501,could-geo-blocking-be-deemed-anti-competitive.aspx

11. Victoria Slind-Flor, 'Cisco, Nikon, Redskins, Google: Intellectual Property', Bloomberg, 25 March 2013, http://www.bloomberg.com/news/2013-03-25/cisco-nikon-redskins-google-intellectual-property.html

12. Catherine Earp, 'Australian Parliament to Probe Apple', Digital Spy UK, 24 March 2013, http://www.digitalspy.com.au/tech/news/a467992/australian-parliament-to-probe-apple-over-itunes-pricing.html

13. Staff Writers, 'Sky High Down Under', The New York Post, 24 March 2013, http://www.nypost.com/p/news/business/new_montauk_project_EhlNjBZnz1uj7bdXLF0QAM

14. David Fickling, Garfield Reynolds, and Sarah Gill, 'Rihanna Costing 49% More As Australia Probes Apple Music', The Washington Post, 22 March 2013, http://washpost.bloomberg.com/Story?docId=1376-MJZNK06KLVRH01-13EU99Q3HFBO6G1JBP296JBR7N

15. David Fickling, 'Rihanna Costing 49% More As Australia Probes Apple Music', Business Week, Bloomberg, 21 March 2013, http://www.businessweek.com/news/2013-03-21/rihanna-costing-49-percent-more-as-australia-probes-apple-music Reprinted on The Sydney Morning Herald, 22 March 2013, http://www.smh.com.au/business/rihanna-costing-49-more-as-australia-probes-apple-music-prices-20130322-2gjlb.html

16. Ticky Fullerton, 'A Preview of the IT Pricing Inquiry with Nick Champion MP', The Business, ABC, 21 March 2013, http://www.abc.net.au/iview/#/program/31792 Cited.

17. Tom Pullar-Strecker, 'Aussie MPs to Grill Tech Barons on Gouging', The Dominion Post (NZ), 16 March 2013, http://www.stuff.co.nz/business/world/8432980/Aussie-MPs-to-grill-tech-barons-on-gouging Reprinted in a range of New Zealand newspapers.

18. Stephanie McDonald, 'Apple, Microsoft, Adobe Summonsed to Appear Before IT Pricing Inquiry', Computer World, 11 February 2013, http://www.computerworld.com.au/article/453367/apple_microsoft_adobe_summonsed_appear_before_it_pricing_inquiry/

19. Fiona Scott, 'The Digital Price is Not Right', ANU News, 28 September 2012, http://news.anu.edu.au/?p=17321

20. Allie Coyne, 'Husic Wants Tech Vendors Subpoenaed to Price Inquiry', CRN, 18 September 2012, http://www.crn.com.au/News/315949,husic-wants-tech-vendors-subpoenaed-to-price-inquiry.aspx

RECOMMENDATIONS

The Australian Law Reform Commission should consider the comments and the conclusions of the IT Pricing Inquiry - House of Representatives Standing Committee on Infrastructure and Communications Inquiry, At What Cost? IT Pricing and the Australia, Canberra: Australian Parliament, 29 July 2013, http://www.aph.gov.au/parliamentary_business/committees/house_of_representatives_committees?url=ic/itpricing/report.htm

In the foreword to the final report, the Chairman of the Inquiry, Nick Champion MP, emphasized the need for Australian consumers to get a ‘Fair Deal’ in respect of Copyright Law and the Digital Economy:

The importance of IT products to every sector of Australian society can hardly be overstated. IT products are woven into the fabric of our economy and society, and have driven rapid change in the way Australians communicate, the way we work, and the way we live. Australian consumers and businesses, however, must often pay much more for their IT products than their counterparts in comparable economies. In many cases Australians pay 50 to 100 per cent more for the same product. Consumer and business concern over IT price differences prompted the Minister for Broadband, Communications and the Digital Economy, Senator the Hon. Stephen Conroy, to refer the question of IT pricing in Australia to the House of Representatives Standing Committee on Infrastructure and Communications for an inquiry and report.Evidence presented to this inquiry left little doubt about the extent and depth of concern about IT pricing in Australia. Consumers are clearly perplexed, frustrated and angered by the experience of paying higher prices for IT products than consumers in comparable countries. High IT prices make it harder for Australian businesses to compete internationally and can be a significant barrier to access and participation for disadvantaged Australians (in particular Australians with a disability).

Based on the evidence received over a 12 month inquiry, the Committee has concluded that in many cases, the price differences for IT products cannot be explained by the cost of doing business in Australia. Particularly when it comes to digitally delivered content, the Committee concluded that many IT products are more expensive in Australia because of regional pricing strategies implemented by major vendors and copyright holders. Consumers often refer to these pricing strategies as the ‘Australia tax’. While the Committee recognises that businesses must remain free to set their own prices in a market economy, it has nonetheless made a range of recommendations that are intended to sharpen competition in Australian IT markets. The Committee hopes that these measures will increase downward pressure on IT prices and improve the access of Australian businesses and consumers to cheaper IT products. Given the ever-increasing importance of IT products to Australian society and the economy – in driving innovation, reducing isolation in regional and rural Australia, or improving the lives of Australians with a disability – it is essential that Australians get a fair deal.

In its parallel inquiry into Copyright and the Digital Economy, the Australian Law Reform Commission should adopt the key recommendations and comments made by the House of Representatives Standing Committee on Infrastructure and Communications Inquiry:

Recommendation 1 The ABS should develop a comprehensive program to monitor and report expenditure on IT products, hardware and software, both domestically and overseas, as well as the size and volume of the online retail market.

Recommendation 2 Considering the importance of IT products to education, and in the interests of greater transparency in this area, the Australian Government, in consultation with Universities Australia and CAUDIT, should conduct a comprehensive study of the future IT needs of and costs faced by Australian Universities, in order to provide clearer financial parameters for negotiations. This recommendation is pertinent to the discussion about copyright law and education by the Australian Law Reform Commission.

Recommendation 3 The Australian Government should consider a whole-of-government accessible IT procurement policy, to be developed by relevant agencies including AGIMO, and in consultation with relevant stakeholder groups including ACCAN.

Recommendation 4 The parallel importation restrictions still found in the Copyright Act 1968 (Cth) should be lifted, and that the parallel importation defence in the Trade Marks Act 1995 (Cth) be reviewed and broadened to ensure it is effective in allowing the importation of genuine goods.

Recommendation 5 The Australian Government amend the Copyright Act’s section 10(1) anti-circumvention provisions to clarify and secure consumers’ rights to circumvent technological protection measures that control geographic market segmentation.

Recommendation 6 The Australian Government should investigate options to educate Australian consumers and businesses as to:

* the extent to which they may circumvent geoblocking mechanisms in order to access cheaper legitimate goods; * the tools and techniques which they may use to do so; and * the way in which their rights under the Australian Consumer Law may be affected should they choose to do so.

Recommendation 7 The Australian Government should clarify ‘fair use’ rights for consumers, businesses, and educational institutions, including restrictions on vendors’ ability to ‘lock’ digital content into a particular ecosystem.

Recommendation 8 The Australian Government, in conjunction with relevant agencies, should consider the creation of a ‘right of resale’ in relation to digitally distributed content.

Recommendation 9 Section 51(3) of the Competition and Consumer Act 2010 (Cth) should be repealed.

Recommendation 10 The Australian Government should consider enacting a ban on geoblocking as an option of last resort, if persistent market failure should exist in spite of the changes to the Competition and Consumer Act and the Copyright Act 1968 (Cth).

Recommendation 11. The Australian Government should investigate the feasibility of amending the Competition and Consumer Act 2010 (Cth) so that contracts or terms of service which seek to enforce geoblocking are considered void. This recommendation is relevant to the discussion of contracting out of copyright exceptions.

Recommendation 12 IT Pricing Committee noted that ‘limited access to IT products in an increasingly interconnected society is a significant contributor to the social isolation and economic marginalisation of Australians, including those who are living with disability’ (2.149). The Australian Government should implement its obligations under the United Nations Convention on the Rights of Persons with Disabilities, and the new 2013 World Intellectual Property Organization Treaty, the Marrakesh Treaty to Facilitate Access to Published Works for Persons who are Blind, Visually Impaired, or otherwise Print Disabled. Accordingly, the Australian Law Reform Commission should recognise that the new proposed defence of fair use explicitly recognise use by or for a person with a disability as an illustrative fair use. This is particularly necessary – given the Australian Law Reform Commission proposes the repeal of s 200AB of the Copyright Act 1968 (Cth), which partly covers disability rights in subsection (4).

Recommendation 13. Australian copyright exceptions should not be constrained or limited by trade agreements – such as the Anti-Counterfeiting Trade Agreement or the Trans-Pacific Partnership. The IT Pricing Committee noted ‘the observation made by the Joint Standing Committee on Treaties in relation to the secrecy with which DFAT conducted negotiations for the Anti-Counterfeiting Trade Agreement: …confidentiality is not common or appropriate in IP negotiations which impact directly and in minute detail on domestic law and domestic innovation policy’ [4.127]. The Committee further noted ‘that the Australian Law Reform Commission is currently conducting a review into copyright and the digital economy, and that the Attorney-General’s Department is currently reviewing Australia’s TPM exception regime’. The Committee agreed with ‘the Joint Standing Committee on Treaties that any international agreement relating to intellectual property should not pre-empt the outcome of, nor be incompatible with, those reviews’ [4.128].