Telecoms ‘caught off guard’ by allegations piracy promoted at retailers: Super Channel

Allarco Entertainment 2008 Inc.’s Super Channel held meetings with “totally surprised” representatives of Canadian telecoms in the weeks before it filed a Federal Court lawsuit against four major retailers, whose employees allegedly peddled the piracy benefits of media boxes they sold in stores. In a phone interview on Monday, Super Channel CEO Don McDonald declined to name the telecoms involved in the meetings or whether their lawyers provided legal advice to the Edmonton-based company, whose content is allegedly being pirated by owners of media boxes being sold at four retailers that are the subject of the lawsuit. He said the telecoms range from small to large. The statement of claim was filed on September 11 and names four stores as defendants: Best Buy Canada Ltd., Staples Canada ULC, Canada Computers Inc., and London Drugs Ltd. It is asking the Federal Court to institute an immediate and permanent ban on the sale and advertising of the media boxes, as well as to prevent employees from teaching or demonstrating how to obtain pirated content. The company would also like the retailers to institute an anti-piracy policy for employees to enforce the prohibition of engaging in that activity at work and at home or face unemployment, a policy Super Channel institutes and encourages others in the industry to do. “They were totally surprised and completely caught off guard that this type of activity was going on in the big box stores,” McDonald said of the telecoms’ reaction in the meetings, which were held “several weeks ago.” Some telecoms have distribution agreements with major retailers, including Wal-Mart, Dollarama and Loblaws, to sell some of their services in those stores. “They applauded our initiatives and our efforts and they were very supportive of what we were doing, and we want to keep them posted.” McDonald said Super Channel wanted the telecoms -- who are not parties in the lawsuit -- to participate in the legal action and is still “hoping” they and others will join in on it. This is the second major legal action involving the issue of piracy in a little over a month’s time. In August, some of the major telecoms won a court order for an IPTV provider called GoldTV to stop providing the ISP’s content without a license. Last week, the case moved to arguments about whether the court should order the ISPs to block the GoldTV websites from being seen, which elicited concerns, including its impact on net neutrality principles, from TekSavvy Solutions Inc. An undercover investigation by Super Channel -- a video of which is published on its website called “change the culture” and that was shown to the telecoms -- revealed employees from sales reps to supervisors and managers telling customers that the media boxes sold would allow them access to “free” TV and movies. The device brands are not specifically named in the court filing. However, Kodi, a popular software media player that allows for the broadcast of that kind of content, is noted to have been installed on the “majority” of the devices under investigation. Super Channel even had a tech lab set up to test the devices, McDonald said. A report last year by Sandvine Corp. found that 71 per cent of Canadian households with a Kodi media player could access unlicensed content through unofficial add-ons obtained from the internet. Kodi has in the past distance itself from these add-ons, saying their software doesn’t come with them. During the course of the 19-month investigation, Super Channel said it documented 150 events supporting its legal claim. The company said more detailed evidence will be filed in subsequent court filings. Rogers Communications Inc. deferred to Super Channel for comment about its possible involvement, while BCE Inc., Telus Corp., and Shaw Communications Inc. did not respond to a similar request. McDonald said the telecoms were not involved in the undercover investigation. Part of the purpose of the meetings with the telecoms was to discuss the need to “change the culture” surrounding piracy, suggesting there needs to be a stronger campaign through “leadership, education, social pressure, public awareness, and enforcement” to link piracy with theft, McDonald said. He added the industry needs to band together to commit to these goals. “There is a complacency around this issue with these retailers that needs to be addressed,” McDonald said in a press release. “Our goal is to lead in changing the culture around the acceptance of content piracy. People need to be aware that it is actual stealing; it is not a victimless crime and should be treated as such.” John Lewis, the vice-president and director of Canadian affairs for the International Alliance of Theatrical Stage Employees (IATSE), last year told a House of Commons industry committee that the popularity of pre-loaded set-top boxes with Kodi software shows that there is a “blasé kind of attitude towards” piracy. Super Channel’s parent company Allarco is only three years removed from being granted protection from its money lenders, after which it instituted a corporate restructuring of its business. It previous filed for bankruptcy in 2009 and blamed part of that on the powerful vertical-integrated companies that control both the network and the content that runs on it. Despite the big BDUs like Bell and Rogers being among the VI companies, Super Channel has sided with them in a group calling for a website blocking scheme to deal with the piracy foe. Many in the industry have already banded together to tackle piracy, including Super Channel, in the form of a coalition to institute a body to order internet service providers (ISPs) to block websites that sell or promote piracy. But questions still linger about what the call for a sweeping ban on the media boxes -- which extends to any of those devices that allow for piracy capabilities -- means for boxes that are used for completely legitimate purposes as well. Roku media players, for example, are used by some customers to view content such as that from Netflix Inc. Some lawyers and experts The Wire Report reached out to could not address this concern in time for publishing. Super Channel’s lawyer on the file, Bill McKenzie, also could not be reached by phone. The argument echoes concerns voiced by critics of FairPlay’s site blocking application, who said the problem is that legitimate websites may be incidentally implicated in the block list. Internet advocacy group OpenMedia argued that blocking websites would open the door to “legitimate content and speech being censored online.” After the site blocking application was denied by the CRTC on jurisdictional grounds, “I felt that something else needed to be done in the war against content piracy,” McDonald said in the release. “We must take action and encourage all other broadcasters and industry partners to join us. We want the devices removed from the shelves and destroyed.” — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Michael Lee-Murphy at mleemurphy@thewirereport.ca

Telecoms ‘caught off guard’ by allegations piracy promoted at retailers: Super Channel

Broadcast | September 16, 2019

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Telecoms ‘caught off guard’ by allegations piracy promoted at retailers: Super Channel

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