Telephone Musack breaches copyright laws, Australian court rules

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SYDNEY -- Popular music played as "holding music" over the telephone breaches copyright laws, the High Court has ruled in a test case brought jointly by Telstra, Australia's major telecommunications company, and the Australian Performing Rights Association which covers composers and songwriters. The ruling does not apply to radio broadcasts played over the phone.

By a 3:2 margin, the court held Telstra breached a much-disputed "diffusion" copyright by carrying music-on-hold over its standard phone network. All five judges also ruled Telstra had infringed broadcast copyright by carrying music on its mobile network.

It did not matter, said the court, that in some cases the Telstra network was merely a passive carrier with no control over music provided by a third party, such as a business. Nor did it matter if people put on hold did not seek or enjoy the service.

The decision has a potentially wider impact, which would include Internet service providers. "I certainly think this decision is of world-wide significance," said Stephanie Faulkner, an APRA lawyer.

Legal and industry analysts have joined APRA and Telstra in urging the government to revise copyright laws to cope with the rapidly converging industries of telephony, computing and entertainment.

Copyright August 1997, Crain Communications Inc.

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