Australia will set an unwelcome precedent if it capitulates to the movie industry in its legal fight with iiNet, warns BitTorrent CEO Eric Klinker.

Last month the Australian High Court allowed the Australian Federation against Copyright Theft (AFACT) to appeal the decision of the Full Federal Court handed down in February this year over the long-running copyright dispute with iiNet, a leading ISP.

In that case, iiNet secured a landmark ruling against a consortium of movie studios and AFACT, which meant it was not liable for the illegal downloading of filmed content by its users.

The revived case should be heard later in the year.

BitTorrent usage is at the heart of AFACT’s woes, but Klinker says the matter goes back to keeping up with changing market dynamics.

"It is a market signal, the whole ecosystem (of file sharing) is a market signal. If you can’t embrace that signal and use it to guide your content efforts then you are missing out on an opportunity," he says.

He adds that one solution could fall back to the government for better laws. “That’s certainly what the MPAA (Motion Picture Association of America) would like to see. Stronger copyright, more enforcement. I think it’s a balance. You always want to balance two things, against the public good, that copyright is meant to foster in the first place but you always want to balance it against the interests of innovation. You would not want to stifle ongoing innovation with burdensome IP rights or copyrights.”

Klinker is following the iiNet vs AFACT case and views it as ‘picking on the small guy’. Why didn’t they go after Telstra, he asks.

“I’m sympathetic to the content rights holders as they have a great challenge. They don’t have an easy, cost effective way to enforce it, but the act of infringement is where it needs to be policed. The first time it’s published, the first time it’s leaked. How does it get there that’s the point of attack. Every technology provider - whether you're providing an ISP service or writing software - needs to be able to preserve the ability to operate their business and continue to innovate.” ®