Callplus leaves global mode company dangling

CallPlus Group seems to be still um-ing and ahh-ing about the merits of mounting a joint defence against the legal action being threatened by Sky TV, Spark, TVNZ and MediaWorks.

The three-man Bypass Network Services Ltd (BNSL), which supplies global mode technology to CallPlus plus a number of small ISPs, says it can't afford to fight the action alone.

Sky TV et al have given BNSL until 5pm next Wednesday to stop supplying its global mode service, which makes it easier join services like Netflix US and BBC iPlayer. They also want NBSL to publicly acknowledge the service is unlawful.

There have been conflicting reports about whether some of the accused ISPs have already crumbled. BNSL's Matthew Jackson tells NBR all of this company's ISP clients are still using his global mode service*. One, however, Lightwire, says "We'd be forced to by the 15th if no other action was taken".

But that's all by-the-by. At the end of the day, everything centres on how CallPlus (owner of Orcon, Flip and Slingshot) plays its hand. And, crucially, whether it lets BNSL piggy back on its legal team.

Privately-held CallPlus, majority-owned by Malcolm Dick, holds around 13% of the ISP market. It has around $200 million revenue, 500 staff and 220,000 customers. Next to that, every other company named by Sky TV et al is a minnow.

So far — a week on from the Buddle Findlay letter — CallPlus will only say that it's open to discussions about a combined defence.

CEO Mark Callander will only say he's open to the possibility.

Meanwhile, we have seen a bit of cheeky ribbing from one of the companies in the CallPlus Group. Slingshot tweeted this afternoon:

First Global Mode? Then John? Jeez Mediaworks, having a bad week? #savecampbelllive pic.twitter.com/eChJNNftpe

— Slingshot (@SlingshotNZ) April 10, 2015

BNSL forced offshore?
Yesterday, an NBR reader suggested:

Maybe the BNSL shareholders should:
1. Set up a foreign company;
2. Sell their business and IP to said company;
3. Continue as per normal.
Then the complainants would have to pick somebody else to sue in NZ.

I put that to BNSL's Matthew Jackson. He did not reply to it directly, but offered, "We are an innovative New Zealand start-up company. We have world-first technology. We are already exporting this technology to the world, we have two international customers and have three signed partners. We’re hoping to help drive the knowledge economy in NZ. We need more success stories like Xero and Vend. Hopefully, Bypass also which will help grow the NZ Internet sector and help all of NZ. We're good for the economy; we've been one of the main drivers to accelerate the uptake of Ultra Fast Broadband and fast tracked the removal data caps which is good for a knowledge economy." Stand by for more on BNSL on Monday when NBR pays a visit.

Another country heard from
This morning on Breakfast, Heather du Plessis-Allan essayed the theory that Sky TV et al might be looking for cheaper NZ rights to content — the idea being that if a global mode ruling goes against them, and Kiwis can tap the likes of Netflix US with impunity, then "exclusive" local rights to a movie or TV series are actually not very exclusive, and so worth less.

Running counter to that is statements made by Netflix execs when they visited NZ immediately before the March 24 Netflix ANZ launch.

They said Sky TV and other local rights holders had scored a lot of their content cheaply. When rights expired, Netflix NZ would join the bidding and give them a bit more competition. 

Lastly, it was interesting to see Spark post a pic of its CEO rallying the groups. Simon Moutter does like a good tussle. But then again, so does CallPlus owner Malcolm Dick, a veteran in the telco and legal trenches who bested The Company Formerly Known as Telecom in the decade-long 0867 free internet case: 

Spoke to the @SparkVenturesNZ & @LightboxNZ teams this morning about the challenges ahead, content rights, and more pic.twitter.com/AzO6vaO64Z

— Simon Moutter (@simonmoutter) April 7, 2015

ckeall@nbr.co.nz

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* The Buddle Findlay letter says BNSL provides a global mode service to Singapore-owned UFB-specialist MyRepublic, Evolution Wireless, Gisborne Net, Netspeed, Unlimited Internet, Mynx Net, Primo Wireless, EOL and Lightwire, as well as CallPlus' Slingshot, Orcon and Flip. MyRepublic tells NBR it does not use BNSL's service but a technology developed inhouse by its Singapore parent company.