Beating back an appeal from Hollywood studios, the Australian High Court rules internet service provider iiNet is not responsible for customers who download pirated films and TV shows.

Telecom has confirmed the sale of AAPT's under-performing retail arm to iiNet for $A60 million, subject to regulatory and iiNet shareholder approval.

Telecom estimates the transaction will have a net negative impact on AAPT’s FY11 ebitda of around $A10 million.

In turn, Telecom announced the sale of its 18.1% stake in iiNet (a retail ISP), held through AAPT's PowerTel division, "to institutional and sophisticated investors" for $A70 million.

Telecom's iiNet stake had a book value of $A81 million as of June 30, 2010.

Telecom’s third attempt to sell its underperforming Australian division, AAPT, seems to have fallen over.

The one remaining bidder, TPG, has dropped out of the race, according to media reports across the ditch this morning.

The rumour-mill has it that Telecom’s board wanted upwards of $A400 million for AAPT (that is, around 4X ebitda), while TPG would not budge from $A350 million.

Australasian TiVo licensee Hybrid TV has surprised the market with the announcement of its latest Australian ISP partner: iiNet.

The controversial iiNet is currently embroiled in a Federal Court copyright law test case. Hollywood studios, and the Australian Federation Against Copyright Theft, accused the provider of ignoring multiple take-down notices after its members posted or shared pirated music, movies and other files.