Optus says it will take action in the Federal Court to protect itself from claims it is infringing copyright by broadcasting AFL and NRL games online.

Thanks to devices such as iPhones and iPads, television watching is no longer something confined to a living room.

It is amid this changing landscape that a major dispute is looming between Optus and Telstra.

The AFL and NRL allege Optus is infringing copyright by broadcasting matches online on as little as a two-minute delay.

But Optus says the claims are unjustified because the games are only playbacks of free-to-air matches.

Telstra says the court's decision could jeopardise its $153 million broadcast deal with the AFL which was signed earlier this year.

It wants Optus to stop providing telecasts of AFL matches to its internet and phone customers via the use of so-called cloud technology.

'Uncharted territory'

The technology enables the game to be recorded and viewed via devices like laptops, smartphones and tablets just minutes after it was shown live.

Luke Hopewell, a technology commentator at ZD Net Australia, says it is uncharted territory for broadcasting in Australia.

"When you're looking at the Optus service in particular, what you have to understand is that you can tell the service what to record from free-to-air television and then stream it back to your device at a time that's more convenient for you," he said.

"So for example, if you have a whole library full of content, then that potential is there to have access to a bevy of material to stream back whenever it's most suitable for you."

The only problem is Telstra has a deal with the AFL to provide the games to its customers; it is also presently negotiating a deal with the NRL.

Sorry, this audio has expired Telstra and Optus in dispute over AFL broadcasts ( Michael Edwards )

"It's a copyright matter. So when you have a look at something like copying CDs to a computer, for example, that was a copyright issue back in the day as well," he said.

"We've now almost sort of moved past that, but what we're looking at here is it's a different kind of taping and a different kind of format shifting, if you will.

"Obviously original copyright holders do get quite nervous when we talk about this sort of thing."

Legal precedent

Optus says the AFL and NRL have alleged it is infringing copyright, so it has turned to the Federal Court to try to stop the two codes from suing it for breach of copyright.

Mr Hopewell predicts the current case will set a precedent.

"If this case comes to a ruling, you'll find a lot of people who will either want to continue the wave if it's a positive ruling for time-shifting services in the cloud, but if it's not you'll find a lot of people backing away from the technology and maybe scratching their heads in their own bunkers and reconsidering a new product," he said.

Optus is confident its service does not result in any copyright infringement.

Telstra says it has serious concerns about the use of any technology to circumvent its rights to the AFL, NRL and V8 Supercars.

The AFL is not commenting.

Mary-Anne Reid, chief executive of the Australian Copyright Council, says the public is going to see a lot more cloud-based storage systems like the one used by Optus.

"[Cloud technology] involves a set of laws that probably didn't contemplate these types of services, and it involves a number of corporations which are looking at ways to make money out of the new online environment," she said.

"All those things have come together to create the situation that we see here."

The hearing begins in the Federal Court on Friday.