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Geo-block busting ISP gets thumbs up from Chapman Tripp

[UPDATE: Fyx axed its Global Mode on May 15. Shortly afterwards it was revealed Fyx' parent company Maxnet had been bought by Australia's Vocus - whose CEO told NBR he was broadbly supportive of ]Fyx' Global Mode, but wanted to shift Maxnet's focus away from the home market.[

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May 10: NBR ONLINE asked Chapman Tripp senior associate Justin Graham for his comment on Fyx's new internet service, which lets New Zealanders beat geographic restrictions on US commercial download providers such as Netflix (whose content is ordinarily blocked to IP addresses from outside the US)..

Mr Graham - a specialist in intellectual property law - gave the service a green light from the standpoint of New Zealand law.

"I’d expect to see increasing activity in this kind of space. It is consistent with New Zealand’s policy on intellectual property, parallel importing and geographical restrictions, namely that geographical restrictions are not consumer-friendly and New Zealand consumers should be able to access copyright content in a competitive and cost-effective environment," he said.

But, as with a New Zealander accessing iTunes US, you could be violating a media provider's commercial terms - giving it the option to cut off your sevice (should it wish to lose a paying customer).

"Whether use of 'global mode' ISPs would prompt contractual responses from content providers would be an interesting issue; a facilitative response would probably ultimately be more beneficial," Mr Graham said.

The Chapman Tripp lawyer was not aware of any other ISP in the world that offered a global mode.

I’m picking there’ll be others following suit in fairly short order though."

ckeall@nbr.co.nz

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New ISP offers access to geo-blocked sites like Netflix

May 8: A new internet service provider, offers a "Global Mode" that "offers greater access to the internet by circumventing geographical restrictions placed on the certain internet services."

FYX ("Fix"), launched on May 4 as a sub-brand of established ISP Maxnet, holds the tantalising promise that its users will be able to directly access US based-commercial download services such as Hulu and Netflix, and the likes of the BBC's iPlayer - all of which offer a motherlode of street-legal movies and TV shows for download, but are "geo-blocked" to stop people outside their parent countries accessing them.

More technical users already use a range of workarounds to access the likes of Netflix.

FYX promises to take geo-block beating into the mainstream.

Pay as you go
The new ISP is also offering an un-capped pay-by-the gigabyte approach of 34 cents per GB - albeit on top of a $34.34 a month (with a phone line) or $59.34 a month (naked DSL) base fee.

There is only one payment option: by credit card.

“It’s about offering a much bigger internet to New Zealanders – the type of internet the rest of the world have had access to for years,” says Chief Internet FYX-er Andrew Schick. 

"There is a bunch of stuff on the internet that a few of us didn't have the freedom to access - at least without stealing it, and we aren't into that. So we decided to FYX the internet by removing some of the barriers that were getting in the way of great choice."

Perhaps wary of legal complications, FYX's website adds, "It's important to remember that first and foremost we are an ISP. We are not a content provider, we just do our hardest give you the freedom you deserve."

My Schick was coy on specifically promoting access to the likes of Hulu and Netflix. When NBR ONLINE raised them, he offered only " the services you mentioned are some of many services able to be used."

Legal?
Earlier, NBR asked Chapman Tripp intellectual property specialist Justin Graham about a similar situation: accessing the US version of iTunes from New Zealand.

The lawyer said that while the arrangement would break Apple's terms and conditions (so far without consequence for your correspondent), it probably did not break the law - and that there is certainly not any issue with the so-called three strikes law.

"The advent of FYX is a fascinating development," New Zealand Computer Society CEO Paul Matthews told NBR ONLINE.

"While many tech-savy kiwis already access overseas content services, preferring to access a legitimate service supposedly illegitimately rather than accessing content from more murky sources, there has still been uncertainty around the legality of doing so from New Zealand. If nothing else, this development pushes the issue."

"I suspect if they're openly marketing Global Mode, the legality will be put to the test in court."

For Mr Matthews, the key message is that the Internet is global. "Enforcing content access based on location is enforcing an 'offline' business model on the online world. That model was always going to break sooner of later. Hats off to Maxnet for pushing the issue."

Sky TV threat
Sky TV and TVNZ have local download rights to most events, movies and shows wrapped up, badly stunting the likes regional contenders such as Quickflix, and the movie and (wholly absent) TV sections of the local incarnation of iTunes.

CEO John Fellet has always maintained his company does not hold a near-monopoly, as it faces new-technology threats from so-called over-the-top content providers such as iTunes and Netflix (at least to a degree. Beyond entertainment programming, the All Blacks and other NZ sports teams will remain a trump card for the pay TV broadcaster).

Today, his prophesy seems a lot more real.

Big ISP to follow?
Keep watching this space.

The head of one of the Big Five ISPs told NBR he was seriously considering launching a new service that would let customers beat geo-blocking.

If FYX doesn't run into any flak, expect him to seriously consider making a run.

More by Chris Keall

Comments and questions
38

I asked Fyx this question on Twitter this morning:

@fyxnz Netflix does not like Proxies being used as it's a breach of their T&C's - what is @fyxnz advise on this?

Their reply was:

@GrantisNZ @CyrisXD @NZTechPodcast PART 1: We need to say very specifically that we are providing a service that gives much greater access 2

@GrantisNZ @CyrisXD @NZTechPodcast PART2 the internet. The user needs to be very aware of terms and conditions on any website they go to,

@GrantisNZ @CyrisXD @NZTechPodcast PART3 whether it is in New Zealand or elsewhere.

This answer implies to me that fyx are suggesting "use this service at your own risk" - which considering their entire selling point is "you can access Netflix/Hulu & iPlayer" seems quite bizarre!

Furthermore, what "if" Netflix/Hulu or iPlayer suddenly enforce their T&C's - this would then make this service essentially useless! :-(

I'm okay with that. Means he is avoiding any legal troubles, and that what they are offering is your own choice... Whether you breach Netflix's TC or not, will be ultimately your own choice instead of being controlled (by being automatically banned).

Anon.

This is akin to my DVD player, which came from one of the companies that also holds the rights to a lot of content.

The DVD player is a zone 4 player, but came with a slip of paper telling me how to switch off the regionalisation.

All FYX is doing is giving me access to the internet. What I do with it is up to me.

Paul Brislen
TUANZ

I believe your scenario is different to this one Paul.

Fyx are selling a service that for all intensive purposes is based upon the fact that you have access to & use of "Netflix/Hulu & iPlayer". That is their selling point - that is what they offer, that is what you PAY for.

However, for them to imply that they cannot guarantee their service & "what you do with it is your choice" - is most definitely NOT what they advertise & as a result, that leaves them on very unsteady ground indeed.

Cheers.

Grant, have a look at the FYX website and you'll find there's no mention of specific websites - far from it. The site spells out clearly that FYX does not guarantee access to any given website or content at all.

What they're doing is giving the user internet access without the regional nonsense imposed by one corner of the internet. I don't need the websites I visit to know where in the world I'm based - it's of no benefit to me. I just want access to the internet and for the provider to get out of the way so I can use that access.

Yes Paul - the website may not specifically mention those sites - but the "implication is there" - look at this article's heading "New ISP offers pay-as-you-go surfing; access to geo-blocked sites like Netflix"...

Also, check this article: http://www.techjungle.com/8093

"A new Internet service has been launched - branded Fyx - and coming from the team at Maxnet. The Fyx service is set to disrupt the market with two unique components bundled together:

A simple low cost 'pay per Gigabyte' ADSL 2+ Internet plan
Global Mode: Providing access to hundreds of international services that are usually blocked for New Zealanders. Includes Netflix, Hulu, Amazon Video, Zune, BBC iPlayer, and hundreds more...."

Check their own website:

"About FYX

FYX is an ISP that is all about open access and freedom. We have enabled a technology we like to call "Global Mode" which creates freedom for New Zealand internet users that doesn't exist elsewhere.

We all know that New Zealand is the best little country in the world. But sometimes being little means that we get passed over when toys are being handed out by the international gods-of-cool-and-fun."

It's plain to see - that Tech Writers know exactly what Fyx's is advertising here, as do people who know about Geo-Blocking.....

If they do not "guarantee any service" - then who the hell would use it??? That's like saying "my motorbike can go faster than other bike in New Zealand - but I can't guarantee it!"

This is hardly the ideal Business Model is it?? They are trying to differentiate themselves in the market - which is GREAT! - but they cannot/will not guarantee the services - what a crock.

@ Paul Brislen
The BBC iPlayer is paid for through the UK Television license. There own conditions on streaming it is to the actual "UK region"
How would TV3/TVNZ streaming service cope if THEY were open to the rest of the world. Would you be happy having to pay for more bandwidth from users not in our country?

[The BBC has said it will charge a small monthly fee for overseas users to access iPlayer - I think most would be willing if that was implemented.

And unlike its domestic operation, BBC International is run on a commercial basis, so it could also server ads to foreign viewers, or at least bumpers before streamed video - CK

What are "intensive purposes"?

Paul, I wholeheartedly agree with the media industry getting with the times and a push like this may help in getting there, but it ignores the fact that the fyx site says their global mode is:
"process of geographical IP restriction circumvention"

I read that as them getting paid for the dodgy practices some are using and hoping they don't get caught.

I hope this gets resolved for the benefit of the consumer, but I expect a few legal firefights before we get to that point

Cheers

Finally someone who understands.....well done!

FYX is a subsidiary of MaxNet, right? MaxNet supports the filter, or at least by last report.

http://techliberty.org.nz/issues/internet-filtering/which-isps-will-filter/

Does FYX?

Hi Grant,

I don't think anywhere does Fyx actually mention or use Netflix, Hulu, or iPlayer in their promotional material, except for two 'Likes' on their facebook page.

It is heavily implied the services are the ones you would use Fyx to beat geoblocking, but it explicitly so.

Cheers,
Sim

It's the "heavy implication" that is the problem here & it's also this implication that differentiates it from the current market & as a result is their main selling point.

But they won't/cannot guarantee it - which leaves the customer up the creek, if the rules change....

Surely - you can see that this type of marketing is not good for the consumer, who frankly deserves better treatment???

This is an unusual precedent & I think unfair to the customer ultimately. Why would anyone choose this type of service, when nothing is guaranteed & a "heavily implied" service may not be able to be delivered sometime down the track??

It smacks of wrong in my book.

Aside from the local issues, the US studios will come down on Netflix and co hard if thousands of kiwis start accessing content that has only been licensed by them for viewing in the US only... There may be a legal grey area as far as FYX goes in NZ, but there won't be in the US and the content providers will somehow find a way to put a stop to it, you can be sure.

[I don't know. If you, say, spend $US38 buying a season of Game of Thrones from iTunes US, HBO's getting a cut. Beats piracy.

Sure there's a local distributor to look after. But look at the three-strikes law so far. Music labels have issued hundreds of notices, movie studios zero.

Partly there's been a dispute about the $25 fee - not that it seems to bother the record companies.

But also there's perhaps an element of NZ being too small a market for the studios to expend much legal effort on. - CK]

@ChrisKeall

Whilst you may be prepared to take a risk with using the US iTunes Service & breaching their T&C's - this does not mean that others will, with the Fyx Service.

Sure - there will be people that take up the service - but there are rather large issues in doing so, namely:

* "The Service" could be pulled at anytime - Fyx does not guarantee anything = FAILED Business Model.

* If you used the service/s, such as Netflix, as intended - you WILL end up with a HUGE bill for Data Use.

This is yet another failed attempt at actually providing a service that NZer's deserve - no surprises here - move on people....

The cost of $34.34 for Broadband service only ( FYX do not offer phone line ) so additional about $50 per month on phone line rental + data charge of 34 cents per Gb does not seem very cost effective when compared to Orcan genius service

Grant S, when FYX say "hundreds of other services" they are serious. Geo-restriction is implemented around the world for all sorts of purposes. It's not just pay services. Some North American providers block access to all Asia Pacific IP addresses to cut down on spam.

If I were a normal broadband user and not already using similar services I would consider the FYX offering.

What I like about their pricing and which others will is the fact that
-It costs $34 for the phone line+ 34c per GB of data used
-pay as you go.
-No contract .

With that price I could easily save at least $40 per mth. But I have to wait for a while till my contract expires with my current provider before I could switch to FYX.

""I’d expect to see increasing activity in this kind of space. It is consistent with New Zealand’s policy on intellectual property, parallel importing and geographical restrictions, namely that geographical restrictions are not consumer-friendly and New Zealand consumers should be able to access copyright content in a competitive and cost-effective environment," he said."

I totally agree with this statement!

However.....you are still breaching Netflix/Hulu & iPlayer's T&C!!!!!!

I think that price would be the main reason for a lot of subscribers wanting to shift to FYX.

No Contract- 34 c per GB of data - Pay as you go

I think that's a really good offering.

Netflix/Hulu et al - offer HD content - you could easily use 500GB a month, in the blink of an eye - which adds up to $170.00 per month, for the Data ONLY.....

Not so attractive now is it.....don't forget - they don't guarantee the service.......& the rules could change at anytime, leaving you high & dry.......

I watch HD Netflix/Hulu instead of ordinary TV, maybe an hour or two a day like a regular TV watcher, and I go through about 150GB/month. Naked, that would set me back about $110.

So your a light user. What about people that watch more TV/Movies than you??

that sounds rather intense, usage of internet traffic for 1-2 hours a day. I watch 1-2 hours a day normally and go through about 40-50 gigs a month. I seriously doubt 150 gigs from 1-2 hours a day.

fascinating watching all the vested interests already trolling and I predict readying the PR machines to dump on anyone who upsets their little $ generating dung heaps.
Just as dotcom was enough of a threat sufficient for the media boys to pull in the big favours including fbi, then so too will the tsunami of change heading across the media planet finally reach our little backwater. Now the fun starts.

If Fyx can fix it I'm ready to watch the flicks on Fyx.

For those who are hating on the ISP.

This ISP is not promising you access to certain places they are saying they are giving you freedom.

Consider your old ISP a train, that would only stop at certain stations. Those stations had limited possibilities and limited what you could access. Some would even believe they limited your access based on new world order principles and back door dealings!

This new ISP is like a car.
You can drive whereever you want, you can even drive over to the video store and hire a video, something you couldn't do at your old train station stop.

BUT the video shop doesn't have to hire it to you. It is just giving you the freedom to get there if you want to give it a go.

This ISP gives you the freedom to drive where you want, but it doesnt give you the ability to go onto private property.

Access versus ability to get there are two different things.

Good on the new isp for giving things a shakeup.
The big wigs want to turn this world into a global economy when they want, but when it suits them they are happy to divide it up amongst each other to control us as well.

So getting around these geo restrictions like this is pretty much what any consumer can do using a commercial vpn service provider such as ivpn.net right?

Competition is good for us. Soon we should see others drop prices too.

Honestly, Netflix from NZ will be a waste of time anyway. Streaming any content from the US is hardly what i'd call streaming, it's more like watching the "buffering" window appear then a tiny grey bar of content loading, then pausing 10 seconds later to load again. Netflix is great when you can load a movie and watch it immediately, having to load it, then walk away and do something else and come back later to view it defeats the purpose.

Hell, even Youtube has problems with streaming content on days when the international bandwidth is being heavily accessed.

TL;DR: The problem is NZ's internet speeds not a lack of content. Any savvy user or someone with Google can get around Geoblocking.

[Agree the data pricing can make it a marginal proposition to stream content - domestic or international.

I can see possible performance issues.

Personally, my preference would be to buy one-off movies or series from the likes of iTunes US (which is not geo-blocked, so you can access it fro any ISP, and does not require a US credit card - see www.nbr.co.nz/itunes - CK]

No its not, I've been using netflix via a VPN for a year now, with speeds of 2 to 3 Mbps netflix streams at high Hd to there Xhd there highest, and the picture puts sky hd to shame. Never any buffering, TVNZ on demand should take note. I'm hard pushed to use up my 120gb data gap as well.

I stream netflix over here just fine in full HD.
Maybe you shoudl get your home wiring looked at?

haha this is a scam. Use Orcon forever, its made me rich and allows me to buy cheap prosties and loose women and plenty of drugs

There are plenty of sites around the world where you don't break terms and conditions. Hulu and Crackle are a good example.

Netflix doesn't require a US credit card. HD content can stream to NZ from overseas unless you're with a shoddy ISP.

Fyx may not cause addtional traffic to international streaming providers, they may pay for it themselves.

Ive signed up with FYX, then Netflix at $US7.95 a month (You need a US address tied to the creditcard) can get this from: USunlocked
Streams HD content no problems

I can't wait for the day when someone hacks the hell out of the US studios and leaves them bankrupt and technically dead in the water.

They are sailing a wooden boat in carbon-fibre submarine infested waters and blowing their ageing legal guns like they mean something.

Dead business models need to die sometime. The internet is no place for dinosaurs.

So where is the content going to come from when all the studios are "bankrupt and technically dead in the water" because nobody's paying for anything?

The overseas sites that put movies and TV programmes online have paid for rights to distribute them in specific territories. They may not care about people using VPNs to access and pay for the content but the creators will.

Why should those who create all the stuff you watch (not Netflix - the studios and production companies) allow people in NZ to do so without getting paid?

I use sureVPN.com to get around geo-blocks and unblock websites. It works great.