Internet companies blocking pirated content

ICTA expresses concern over move

At least two Internet companies in the Cayman Islands are now preventing customers from streaming movies, television and other content not licensed for broadcasting in the Cayman Islands.

Both FLOW and C3 have confirmed that where possible they are blocking pirated content from entering the territory on their networks. Cayman’s other main Internet service provider Logic did not respond to questions on the issue.

Though there are still no up-to-date copyright laws in force in the territory, FLOW says it has a “legal obligation” to protect the rights of copyright owners. C3 said it was following an international trend with providers around the world, including Netflix, pursuing a similar strategy to prevent unauthorized use of licensed content.

The Information and Communications Technology Authority said it was investigating the implications of the move.

“Any time a telecommunications service provider decides to interfere with the services provided to their customers, such as blocking certain websites, or certain content, it raises concerns about privacy, extra-legal censorship, and other issues,” said ICTA managing director Alee Fa’Amoe

“The Authority is reviewing the actions of its licensees with respect to unilateral blocking of certain traffic, and will consider if any actions are warranted once all the facts are available.”

It is understood that the move has principally impacted Cayman Islands residents using Roku or android boxes. The devices, similar to Apple TV set-top boxes, use Web apps to allow users to stream television channels and other content from all over the world.

Denise Williams, senior vice president of communications with Flow’s parent company Cable & Wireless Communications, declined to reveal how the company was blocking content, but insisted it was not snooping on its customers’ Internet use.

She said, regardless of Cayman law, the company has an obligation under U.S. law to ensure compliance with telecommunications licenses.

She said it was taking similar action across the Caribbean after several requests to its U.S. operation from copyright holders requesting it to stop illegal content being accessed through its network.

“Content that is not cleared for the region is therefore being blocked from entering the region by our team in the United States,” she said.

“We wish to reiterate that C&W does not monitor what our customers access on the Internet, nor do we know what they are watching. We are simply preventing illegal content from entering the region on our network.”

A spokesman for C3 confirmed it was using the same strategy.

“As a licensed content provider, C3 is obligated by the content owners to mitigate any unauthorized use of the content we are legally providing in the market. To this end, we are blocking the IP addresses of these pirated content providers. C3 will remain vigilant in blocking future IP addresses conducting these pirate activities.”

The extent to which the companies have been able to disrupt users from pirating content is not clear.

Sandra Hill, a businesswoman who runs RoCay, which sells Roku streaming boxes to consumers, said some customers had been impacted. She said some were switching Internet service providers as a result of the move.

Ms. Hill said she was disappointed at the “tactic,” which she believes is designed to limit consumer choice and force more people to buy FLOW TV.

“In the final analysis, they are losing customers who do not trust them with their Internet and have online privacy concerns,” she said.

Ms. Hill also questioned whether FLOW, as an Internet service provider, had the authority to police copyright in the Cayman Islands. Mr. Fa’Amoe said the ICTA would be pondering the implications of the actions.

“In other countries, these kinds of issues have been explored in great detail and, as a result, concepts around net neutrality have emerged,” he said.

He told the Cayman Compass in an earlier interview that the rights of companies to protect their copyright had to be balanced with the rights of consumers.

“As a democracy, we need to balance the rights of a copyright holder with the privacy rights of our citizens. Just because you own a copyright doesn’t necessarily give you or a law enforcement body the right to monitor the Web surfing activity of Internet customers, who have some expectation of privacy.”

He said he was generally unconcerned about people using Roku boxes or other technology to stream copyrighted content. He said they were not breaking any Cayman Islands law that he was aware of and formed a small part of the market.

“None of our television providers in Cayman,” he said, “entered the TV space blindly or without the full knowledge that there were already alternatives available here in this market, whether from satellite dish providers or Internet streaming boxes like AppleTV or Roku.

“The bottom line is that disruption is nothing new. So, if you’re a telecom service provider anywhere in the world, including Cayman, my advice is – accept that disruption is an integral part of your industry. Improve your own network and services and compete to win your customers’ business.”

He said the ICTA would not be the body enforcing copyright legislation, if and when it is passed. And he insisted the regulator was more focused on ensuring its licensees maintained a higher level of service.

“Our ability to compete as a global financial center and a regional tourism destination will not be determined by a few local companies offering streaming video boxes. It will, however, be radically impacted by poor telecom service or high prices or the lack of choice.

“We have lost millions of dollars of inward investment because of our lack of high-quality telecom infrastructure. To date, I’m not aware of any multimillion dollar deals failing to close because of a local streaming set-top box couldn’t deliver the latest episode of the ‘Voice.’ The ICTA, the local ICT industry, and the entire jurisdiction have bigger fish to fry.”

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  1. This appears to be a complicated subject which regular customers of Internet Service Providers find confusing and questionable.

    For instance, my question is, if I am a customer of NETFLIX headquartered in the US, and I have a paid up account that allows me to watch the full range of progrms offered as part of the subscription. what difference does it make as to where I am watching them? I believe that NETFLIX for example is paying something to the copyright holder for each viewing of the material. Is that not correct? If I am correct in this assumption, what does it matter where I watch? I am a legal subscriber, pay my monthly fee and should be able to watch from anythere, as it is of no additional cost to NETFLIX nor the copyright holder.

    Perhaps one of the Internet Service Providers of covernment officials or any other expert can answer this question.

    • The answer to your question about Netflix is that television and movie licensing and distribution rights are very complicated and most often not the same from region to region or even country to country. Take two simple examples: Netflix might negotiate with Warner Brothers USA for the rights to license or distribute a movie or television program in the US and pay WB USA a royalty for that right. However it’s very possible that WB USA does not own the rights to that same movie or program outside the USA, perhaps Fox or Sony own those rights and Netflix hasn’t negotiated a distribution agreement with them, so your watching that content outside the US violates the copyright of the holder outside the US, and Netflix obviously wouldn’t want to pay WB USA a fee for you to watch something they don’t have the right to distribute. Alternatively maybe WB USA owns the rights to a show and negotiates with Netflix to distribute it in the USA only, but they have already negotiated an exclusive licensing and distribution agreement with another provider (a Netflix competitor) to distribute the content outside the USA, maybe even a contract specific to the Caribbean, and you watching that show violates the terms of the exclusive agreement with the Netflix competitor. While at the end of the day, you pay Netflix and they pay WB USA, the exclusive distributor outside the USA gets screwed and perhaps threatens to sue both Netflix and WB USA for breach of contract since they have surely paid WB USA a heft sum for exclusive distribution rights. WB USA has an incentive to ensure the agreements are enforced since their exclusive distribution agreements are valuable and less so if Netflix allows anyone anywhere to violate them. Netflix has an incentive to enforce the agreement and block your access because it wants a seat at the negotiation table with WB USA and every other studio and can only get that seat if they are viewed as a good faith participant in the legal content distribution industry. In this case all parties involved have an incentive to ensure the agreements are enforced properly and the content is distributed as intended.

      None of this answers the question though of whether ISPs should be blocking selected content from entering the territory.

  2. I wish these internet providers would be a little more honest about their reasons for blocking the targeted content. Anyway, the country needs to move quickly on the implementation of laws to protect and promote net neutrality in the Cayman Islands.

  3. This issue is the result of no real and quick enforcement of any rules. We have lots of rules for everything, and no real enforcement of anything.

    The internet is regulated by others outside of Cayman, ICANN and these carriers are just doing what they required to do OR they loose all internet connection to Cayman.

    The TV side is just the wild west as no one regulates that.