Four New Zealand media companies recently joined forces to flex their collective muscles against Call Plus-owned media companies Orcon, Slingshot and Bypass Network services.
The ''Big Four'' claim the companies are breaching copyright and operating outside the law by providing customers access to otherwise blocked international TV and movie services.
The companies have threatened legal action by way of ''cease and desist'' letters sent to the alleged copyright infringers, who at this stage appear to be standing firm on the legality of their unblocking services.
The market in New Zealand has recently seen a flood of new internet-based TV services which have the potential to undermine the pay-to-view television market in New Zealand.
Traditionally, production companies have been able to earn revenue from licensing of such content on a territorial basis.
Exclusive licenses allow the licensee to recoup licensing costs in their territory by being the only source of the licensed content.
Where those services are being delivered over the internet, various technological devices have been used to restrict access to those not in the licensed territory, thus preventing NZ users from accessing content directly from an overseas provider.
This demonstrates the inherent monopoly conferred by intellectual property rights, in this case copyright in the programme content.
Inevitably, innovators have found their own solution to the monopoly by devising unblocking devices which enable users to circumvent the restrictions on access to overseas content, which undermines the ability of the legitimate licensees to recoup the costs of purchasing country-wide rights to the content in the first place.
This technology is at the core of the recent claims by the large NZ media companies.
One example of such technology is Slingshot's Global Mode, which has allowed New Zealanders ''back door'' access to the US version of Netflix.
Netflix is a subscriber service allowing users to watch TV shows and movies online. Netflix recently launched a New Zealand version of its product so users can access the service without the use of products such as Global Mode.
The NZ media companies now threatening action against those they see as facilitating breaches of their IP rights are offering or intending to offer their own internet-based streaming services.
While proceedings do not appear to have been filed as yet, this issue demonstrates the historic tension between encouraging creativity and innovation by offering intellectual property rights as protection and allowing consumers access to a wide range of products at a competitive price.
Those who argue products such as Global Mode are legitimate claim it is just another form of parallel importing.
This is where products bought in another jurisdiction from a supplier who has the right to sell products in that jurisdiction can be imported into New Zealand.
This is specifically provided for in both our Copyright Act and Trade Marks Act.
It will be interesting to see the legal basis for the contrary argument put forward by the media companies who stand to lose significantly from this competition.
What is clear is that the traditional media for delivery of television and movie content are going to have to change in the same way iTunes forced fundamental change in the music industry.
Sally Peart is a partner in Marks & Worth Lawyers.