CATCHWORDS

COPYRIGHT - playing of music "on hold" over the telephone - whether Telecom infringes copyright in works used to provide music on hold - situations identified including calls to a Telecom office playing music on hold, to a customer who plays music on hold, and to a customer on whose behalf Telecom plays music on hold, whether or not the call utilizes the mobile telephone network, and whether the music is recorded music or broadcast music received by a radio set and then transmitted over the telephone - right to broadcast a work - right to cause a work to be transmitted to subscribers to a diffusion service - construction of s. 26 of the Copyright Act 1968 - whether music on hold is transmitted "to subscribers to a diffusion service" - whether Telecom, when transmitting music on hold sourced in a sound broadcast has the benefit of s. 199(4) - whether, where mobile telephones are used, there is a "broadcast" within s. 31(1)(a)(iv), i.e. a transmission by wireless telegraphy to the public within s. 10 - meaning of "to the public" - whether "the copyright owner's public" is referred to - legislative history and its effect.

Copyright Act 1968, ss. 10, 26, 31(1)(a) and 199(4)

Telecommunications Act 1991, ss. 5, 253 et seq.

Performing Right Society Ltd v. Marlin Communal Aerials Ltd

  [1977] FSR 51

Australasian Performing Right Association Limited v. Telstra

  Corporation Limited (1993) 46 FCR 131

Regina v. Effik [1995] 1 AC 309

Australasian Performing Right Association Limited v.

  Commonwealth Bank of Australia (1992) 40 FCR 59

Jennings v. Stephens [1936] 1 Ch 469

Ernest Turner Electrical Instruments, Limited v. Performing

  Right Society, Limited [1943] 1 Ch 167

Australasian Performing Right Association Limited v.

  Canterbury-Bankstown League Club Limited (1964) 81 WN (Pt 1)

  (NSW) 300; (1964-5) NSWR 138

The Performing Right Society Limited v. Rangers F.C.

  Supporters Club [1975] RPC 626

Rank Film Production Ltd v. Colin S. Dodds (trading as Town

  and Country Motel) (1983) 2 NSWLR 553

Charter v. Race Relations Board [1973] AC 868

Chappell & Co Ltd v. Associated Radio Co of Australia Ltd

  [1925] VLR 350

Performing Right Society Ltd v. Harlequin Record Shops Ltd

  (1979) 1 WLR 851

Mellor v. Australian Broadcasting Commission [1940] AC 491

Duck v. Bates (1884) 13 QBD 843

Harms (Incorporated) Limited v Martans Club Limited [1927] 1

  Ch 526

Performing Right Society Ltd v Hawthorns Hotel (Bournemouth)

  Ltd [1933] Ch 855

AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED v. TELSTRA CORPORATION LIMITED

NG 951 of 1993

CORAM: Black C.J., Sheppard and Burchett JJ.

PLACE OF HEARING: Sydney

DATE:  23 August 1995

IN THE FEDERAL COURT OF AUSTRALIA                       )

NEW SOUTH WALES DISTRICT REGISTRY                     )           NG 951 of 1993

GENERAL DIVISION                                                            )

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

                                    BETWEEN:                 AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED

                                                                                    Appellant

                                    AND:                           TELSTRA CORPORATION LIMITED

                                                                                    Respondent

COURT:          Black C.J., Sheppard and Burchett JJ.

PLACE:           Sydney

DATE:23 August 1995

                                                         MINUTES OF ORDER

THE COURT ORDERS THAT:

1.         The appeal be allowed.

2.         It be directed that the appellant file and serve, within twenty-one (21) days, short minutes of orders appropriate to reflect the reasons of the majority of the Court; that the respondent, within a further fourteen (14) days, file and serve notice of any objections to those short minutes, with short minutes of any different form of orders for which it may contend; and that the orders of the Court thereafter be settled in such manner and after such further argument, if any, as the Court may further direct.

3.         There be included in the final orders of the Court an order that the respondent pay the appellant's costs of the appeal.

NOTE:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA                       )          

NEW SOUTH WALES DISTRICT REGISTRY                     )           NG 951 of 1993

GENERAL DIVISION                                                            )

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

                                    BETWEEN:                 AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED

                                                                                    Appellant

                                    AND:                           TELSTRA CORPORATION LIMITED

                                                                                    Respondent

COURT:          Black C.J., Sheppard and Burchett JJ.

PLACE:           Sydney

DATE:23 August 1995

                                                   REASONS FOR JUDGMENT

BLACK CJ:

This is an appeal in what was described by the learned primary judge (Gummow J) as a test case to determine whether the provision of music to be heard by telephone users placed on "hold" ("music on hold") constitutes an infringement of the copyright in the works used to provide that music.  His Honour held that none of the activities of the respondent upon which the appellant relied amounted to the doing of acts comprised in the appellant's copyright and he therefore dismissed the appellant's application for declaratory and injunctive relief. 

Music on hold may be provided to a caller in various ways.  The different situations are described in the reasons for judgment of Sheppard J and Burchett J, and  in the reasons
for judgment of the primary judge: see Australasian Performing Right Association Limited v. Telstra Corporation Limited (1993) 46 FCR 131.  In summary, his Honour found that music on hold may be provided in ways that include the provision of music on hold by a third party to callers, the provision of music on hold by the respondent's service centres to callers and the provision of music on hold by the respondent to callers in the course of a special music on hold service provided by the respondent to certain customers, and known as "CustomNet".  In each of these cases, music on hold is transmitted through the general telecommunications network operated by the respondent.  Music on hold may also be transmitted to callers through mobile telephone systems operated by the respondent.

The rights in relation to musical works that the appellant claims have been infringed by the respondent, which I shall refer to by its former trade name of "Telecom", are the exclusive right arising under s.31(1)(a)(v) of the Copyright Act 1968 ("the Act") "to cause the work to be transmitted to subscribers to a diffusion service"  and also the exclusive right arising under s.31(1)(a)(iv) of the Act "to broadcast the work".

I turn first to the question whether the provision of music on hold in the circumstances found by the trial judge involved an infringement by Telecom of the exclusive right to cause the musical works to be transmitted to subscribers to a diffusion service.  This necessitates a careful examination of  s.26 of the Act, which defines the content of the exclusive right arising under s.31(1)(a)(v) and which provides the means for identifying
who it is that "causes" a work to be so transmitted.  Each part of the section is important and I set it out in full:

            "26.      (1)        A reference in this Act to the transmission of a work or other subject-matter to subscribers to a diffusion service shall be read as a reference to the transmission of the work or other subject-matter in the course of a service of distributing broadcast or other matter (whether provided by the person operating the service or by other persons) over wires, or over other paths provided by a material substance, to the premises of subscribers to the service.

                        (2)        For the purposes of this Act, where a work or other subject-matter is so transmitted:

                                    (a)        the person operating the service shall be deemed to be the person causing the work or other subject-matter to be so transmitted; and

                                    (b)        no person other than the person operating the service shall be deemed to be causing the work or other subject-matter to be so transmitted, whether or not he provides any facilities for the transmission.

                        (3)        For the purposes of the application of this section, a service of distributing broadcast or other matter shall be disregarded where the service is only incidental to a business of keeping or letting premises at which persons reside or sleep, and is operated as part of the amenities provided exclusively for residents or inmates of the premises or for those residents or inmates and their guests.

                        (4)        A reference in this section to the person operating a service of distributing broadcast or other matter shall be read as a reference to the person who, in the agreements with subscribers to the service, undertakes to provide them with the service, whether he is the person who transmits the broadcast or other matter or not.

                        (5)        Where a service of distributing matter over wires or over other paths provided by a material substance is only incidental to, or part of, a service of transmitting telegraphic or telephonic communications, a subscriber to the last-mentioned service shall be taken, for the purposes of this section, to be a subscriber to the first-mentioned service."

It is common ground that where music on hold is played in circumstances in which transmissions to mobile telephones are not involved, there is a transmission over wires or over paths provided by a material substance (such as a path provided by fibre optic cables).  For convenience, in the discussion that follows, a reference to transmission or distribution over wires should be taken to include a reference to transmission or distribution over paths provided by a material substance.

Although the essential statutory concept of transmission to subscribers to a diffusion service appears from s.26(1), special provision is made by s.26(5) for the situation in which a service of distributing matter over wires is only incidental to, or part of, a service of transmitting telegraphic or telephonic communications.  In situations to which it applies, s.26(5) is no less important than s.26(1) and in my view the outcome of the appeal in respect of the diffusion right turns on s.26(5).

The first question to be considered is whether the transmission of music on hold is a transmission in the course of a "service" of distributing matter.  His Honour held that, in demonstrating the provision of music on hold, the appellant had not identified a service other than the telephone service itself, and had therefore failed to identify a service to which s.26 might apply.  The concept of "a service" is a broad one.  It is not confined to extensive national services such as the telephone service or the postal service but extends to benefits provided on a small scale and within a small area, such as a "home delivery service" provided by a shopkeeper to customers or the provision of recorded music in commercial premises "as a service to customers".  Thus, s.26(3) contemplates that
something as small or as local as the distribution of broadcast or other matter as part of the amenities provided to guests in an hotel may be a service.

In the examples given, the particular service may or may not be appreciated by an individual shopper but it will be provided because a trader makes the judgement that, overall, the provision of the service will be perceived as a benefit and will be good for business.  If the service is provided by a third party, much as Telecom provides a music on hold service for its CustomNet customers, the trader will receive a service and it will be true to say that the service is provided for the benefit of the trader.  It will also be true to say, however, that the service, whether provided directly by the trader itself or by a third party, is provided for the benefit of the trader's customers.  It is the perceived benefit to the customers that makes the provision of the service of benefit to the trader.  What is provided is still a service even if it is not sought or appreciated by members of a class to which it is intended to appeal.  To take the case contemplated by s.26(3) as an example, the service of distributing music as part of the amenities provided exclusively for guests might well be unsought and there might well be guests who would prefer not to listen to the music provided as an amenity in their rooms, yet it would still be a service within s.26(3).

Section 26(3) also confirms that a service within the meaning of s.26 can be something that is only incidental to a business.  Section 26(5) goes further; it confirms that a service that is only incidental to or is even part of another service, at least when that other service is a telegraph or telephone service,  may be a service for the purposes of s.26.

It must be noted, however, that a service for the purposes of s.26 is one to which there are subscribers.  This appears from s.26(1), s.26(4) and s.26(5).  Also, the section assumes a service that is the subject of agreements between subscribers and another person by which that other person undertakes to provide the subscribers with the service: see s.26(4).  His Honour held that, even if the provision of music on hold were a service, there are no agreements of the kind required in existence.  Section 26(4) is an important provision because, in conjunction with s.26(2), it provides the means for determining who, for the purposes of the Act, causes a work to be transmitted to subscribers to a diffusion service.  I return later to consider the way in which s.26(4) and s.26(5) interact. 

Assuming for the moment that music on hold is a service, is it a service of "distributing" broadcast or other matter ?  In my view it is.  If the equipment is operating correctly, the music on hold from a particular source is transmitted to everyone within the class of people who are intended to hear it, namely those who call a number in respect of which the service is provided and are then put on hold.  Over time there will doubtless be many such people, although at any given time there may be none, or only one.  To the extent that the calls of those who are put on hold do overlap in time the various callers may be hearing exactly the same segment of the same music, which will be transmitted to them simultaneously, having been reproduced from the one compact disc, audio cassette or radio broadcast.  Whilst, however, simultaneous transmission no doubt does take place, the essence of distribution is the spreading abroad or dispersal of the thing being distributed, not its simultaneous dispersal.  The distribution of a pamphlet, for example, is no less a distribution because it takes place over time.  The service of distributing published matter, say a magazine, to the premises of subscribers to the magazine would be no less a distribution service because the distribution might take place over days or even weeks.  With respect, I do not agree with the conclusion that no distribution occurs in the provision of music on hold through the telephone system; in each of the cases found by his Honour there is dispersal, from a common source, of electro-magnetic currents carrying music on hold to callers.  The fact that a separate current may flow to each caller does not deprive the process of being of the nature of a distribution.  Moreover, the section recognises, in s.26(5), that a service of "distributing" matter can be part of a telephone service to which there are subscribers, notwithstanding limitations on the capacity to "distribute" imposed by the nature of a telephone service, which typically, although not invariably, provides means of communication between only two people.

Assuming there to be a service and that it is a service of distributing matter, is there a service of distributing matter "to the premises of subscribers to the service" ?   The service certainly involves distribution to premises in the sense that the music on hold is transmitted to telephones in premises. (I put to one side the limited case of distribution to outdoor public telephones.)  Unless, however, either by the operation of s.26(5) or in some other way, it can be seen that there are subscribers to the service of distributing matter, this element of s.26(1) cannot be satisfied.

In my opinion, s.26(5) operates to provide the subscribers.  If there is a "service", a question to which I shall return shortly, it follows from what I have said that I would conclude that the provision of music on hold to callers to a particular number is a service
of distributing matter over wires or over other paths provided by a material substance.  So regarded, it is, in my view, necessarily a service that is incidental to the telephone service in the sense that when people use the telephone service they will receive the benefits, such as they may perceive them to be, of music on hold instead of silence if, by reason of that use, they are put on hold after calling a number that has a music on hold service.  The purpose of the telephone call will obviously be to speak to someone at the called number; the primary service is the telephone service.  But incidental to the telephone service, and only incidental to it, there will be the service, appreciated no doubt by some and perhaps the source of annoyance to others, of music being played for the caller if the call cannot be attended to immediately.

In such a case s.26(5) operates so that a subscriber to the telephone service is to be taken, for the purposes of s.26, including of course s.26(1) and s.26(4), to be a subscriber to the distribution service.  Reading s.26(1) having regard to the effect produced by s.26(5), it can then be seen that where music on hold is provided either by Telecom or by one of its subscribers there is a transmission of a work in the course of a service of distributing broadcast or other matter (the music on hold service) over wires or other paths provided by a material substance to the premises of a subscriber to the telephone service who, by virtue of s.26(5), is to be taken to be a subscriber to the music on hold service.

Section 26(5) does not require there to be in existence any actual subscription to the service that is "only incidental or part of a service of transmitting . . . telephonic
communications".  The service must of course exist as an incidental service or as one that is part of the telephone service but, given that existence, it is sufficient for the operation of the sub-section that there is a subscriber to the telephone service.

It remains to be seen whether s.26(4) points to any different conclusion.  It would be surprising if it did because s.26(5) is unambiguous in its provision that a subscriber to one type of service is to be taken, for the purposes of s.26, to be a subscriber to the other, and, as I have noted, it contains no requirement that there should be any actual subscription to the incidental service of distributing matter over wires.  The sub-section must have been intended to operate in conjunction with s.26(4), which is a sub-section of critical importance to the process of discovering, through s.26(2), who is to be taken as causing the work to be transmitted to subscribers to a diffusion service.  It seems hardly likely that s.26(5) was intended to be confined in its operation to cases in which, despite the service of distribution being only incidental to or part of a telegraph or telephone service, the distribution service was the subject of a separate subscription agreement.  On the other hand, s.26(4) clearly does assume that there will be an agreement with subscribers, and one such that it will be possible to identify a person who undertakes to provide the subscribers with the service.

In my view, the solution to the problem is to be found partly in the content of the notion of "subscriber" in s.26 and partly within s. 26(5).  Nowhere in s.26 is a subscriber defined as someone who is a party to an agreement under which another person undertakes to provide him with a service.  Rather, as s.26(4) shows, it is assumed that a subscriber to
a service will have the benefit of an agreement to provide the service subscribed to.  Section 26(5) provides that a person "shall be taken" to be a subscriber.  At the very least, being a subscriber to a service must carry with it the implication of a right to the provision of the service subscribed to.  Accordingly, when s.26(5) provides that a person is to be taken, for the purposes of s.26, to be a subscriber to a service  that person is also to be taken to be a beneficiary of the basic obligation owed, whether expressly or impliedly, to a subscriber by the provider of the service subscribed to.  What, however, of the need to identify a person who, in the agreements with subscribers to the service, undertakes to provide them with the service?  For the purposes of s.26, in cases in which the diffusion service is in fact part of the telephone service to which a person has subscribed, the person who undertakes to provide the deemed diffusion service subscriber with the service of distributing matter must necessarily be taken to be the provider of the telephone service, and it cannot have been intended that a different result would follow where, instead of being part of the telephone service, the service of distributing matter is only incidental to the telephone service.  It follows that I disagree with the conclusion of the learned trial judge that s.26(5) cannot operate to deem an agreement for the provision of the service of distributing matter in circumstances where that service is only incidental to, or part of, a telephone service.

Viewed in this way, there is harmony between the various parts of s.26.  Section 26(5) has scope for practical operation according to its terms.  The subscriber to the telephone service is taken to be a subscriber to the incidental service or services of distributing matter, the deemed subscription to the service of distributing matter carries with it the
implication that there is an obligation to provide the service subscribed to, and that obligation is taken to be imposed upon the person who in fact agrees to provide the telegraph or telephone service of which the other service is part, or is only incidental.  So viewed, I do not consider that s.26(4) points to some narrower concept of "service" than that which I have previously discussed.

In the present case, then, through the operation of s.26(4) and s.26(2), Telecom, as the person who is taken to be operating the service of distributing matter is, for the purposes of the Act, deemed to be the person causing music on hold to be transmitted.

The Court was referred in argument to the history of the provisions of the Act dealing with the diffusion right, but I have not found an examination of that history to be of assistance in the case.  The relevant provisions of the Act are based upon the English Copyright Act, 1956, s.48 of which may be said to be the counterpart of s.26 of the Australian Act.  Some of the language is very similar, although there are also substantial differences.  It is perhaps significant, however, that the critical provision in the present case, s.26(5), had no counterpart in the English Act of 1956.  Section 26(5) appears to have been of Australian origin and may reflect developments that had taken place in this country and elsewhere by the late 1960's.  For although recorded music services on the telephone may not have been known in Australia in 1968 when the Act was passed, other kinds of recorded services were well known at that time.  These included the weather service, the time service and sports results.  There were recorded recipe services.  Indeed, "Dial-a-disc" was available in Australia in the early 1970's, not long after the passage of
the Act.  In these circumstances I do not think it should be concluded that the possibility of copyright matter being played to callers through the telephone system was beyond anything the Parliament could have foreseen when it enacted s.26, with the special provisions that are contained in s.26(5).

I would therefore allow the appeal insofar as it concerns the right to cause the musical works to be transmitted to subscribers to a diffusion service except where the source of the music is not a compact disc or a tape or some other recording, but is an authorised sound broadcast. 

Where the source of music on hold is an authorised sound broadcast the provisions of s.199(4) must be taken into account and I agree with Burchett J, for the reasons he gives, that s.199(4) operates in such cases so as to require the person who causes the musical work to be transmitted to be treated, in infringement proceedings, as if he had been the holder of a licence granted by the owner of the copyright to cause the work to be transmitted by him to the subscribers to the diffusion service.

The final issue in the appeal concerns the broadcast right in circumstances where music on hold is heard by the users of mobile telephones, it not being argued that in such cases there was any infringement of the diffusion right.  The right to broadcast a work arising under s.31(1)(a)(iv) is, by reason of the definition of "broadcast" in s.10 of the Act, the right to transmit by wireless telegraphy to the public.  The critical words here are "to the public", and I agree with Sheppard J and with Burchett J, for the reasons they give, that
the transmission of music on hold to a mobile telephone is a transmission to the public and that the broadcast right is infringed in such cases.  I agree that the circumstances that the transmissions are private and to individual members of the public do not prevent the transmissions being to the public.

I would therefore allow the appeal in relation to the broadcast right also.

This is a complicated matter and, as suggested in argument before us, the parties should have an opportunity to consider the reasons for judgment and to propose minutes of order appropriate to reflect those reasons.  If necessary, there should be an opportunity for further argument.

I therefore propose that, at this stage, the Court should order that the appeal be allowed and direct that the appellant file and serve, within 21 days, short minutes of order appropriate to reflect the reasons of the majority of the Court and that the respondent, within a further 14 days, file and serve notice of any objections to those short minutes.  The respondent should at the same time file and serve short minutes of any different form of orders for which it may contend.  I would direct that the orders of the Court thereafter be settled in such manner and after such further argument, if any, as the Court may further direct.

There should be included in the final orders of the Court an order that the respondent pay the appellant's costs of the appeal.

                                                                                    I certify that this and the preceding 13 pages are a true copy of the reasons for judgment of the Honourable Chief Justice Black.

                                                                                    Associate:

                                                                                    Date:                            23 August 1995

IN THE FEDERAL COURT OF AUSTRALIA)

                                  )

NEW SOUTH WALES DISTRICT REGISTRY)    No. G951 of 1993

                                  )

GENERAL DIVISION                  )

            On appeal from a single judge of the

                 Federal Court of Australia

                        BETWEEN:

                             AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED

                                  Appellant

                        AND:

                             TELSTRA CORPORATION LIMITED

                                  Respondent

                    REASONS FOR JUDGMENT

COURT:    BLACK CJ, SHEPPARD and BURCHETT JJ

PLACE:    SYDNEY

DATE :    23 AUGUST 1995

SHEPPARD J:  This is an appeal from a judgment of a judge of this Court (Gummow J) in which an application brought by the appellant for injunctive and other relief was dismissed.  The judgment appealed from is reported ((1993) 46 FCR 131).  The application was one brought by the present appellant, to whom I shall refer as "APRA", as a test case to determine whether the provision of music to be heard by telephone users placed "on hold" constitutes an infringement of the copyright in the works used to provide that music.  At the time the case was heard at first instance, the respondent traded under the name of Telecom and I shall refer to it hereafter in that way.

     Many commercial and government telephone systems have the capacity to play music "on hold" to callers who cannot be immediately attended to.  The source of the music will usually be a device which causes recorded or broadcast music to be played to waiting callers.  Telecom itself provides this service when calls made to its service centres are placed on hold.  It also provides a service, known as CustomNet, to subscribers who require it.  These then have the capacity to have music on hold played to waiting callers.  Other subscribers to Telecom secure the ability to play music on hold to customers by using or acquiring equipment either provided by themselves or suppliers other than Telecom.  In such cases a permit for the equipment is required; see Division 6 of Part 12 of the Telecommunications Act 1991 and the definition of "customer equipment" in s.5 thereof.

     Often what the caller hears is not recorded music in the sense of it coming from a compact disc player or tape recorder but is music broadcast from one or other of the radio stations.  Most telephone calls, although the transmission of them may be partly by radio, may be regarded as being transmitted by landline using that expression in the broad sense of "over wires or other paths by a material substance" which are the words used in subsec. 26(1) of the Copyright Act 1968 to which I shall refer in more detail a little later.  That will not be the case, however, in relation to calls made from mobile telephones.  They are made substantially by radio. 

     Essentially then what is involved in this case is music on hold played to waiting callers in the following circumstances:-

     (a)  music on hold played to callers who telephone Telecom's service centres;

     (b)  music on hold played to callers who telephone organisations (other than Telecom) which have availed themselves of CustomNet;

     (c)  recorded music on hold played to callers who telephone organisations (other than Telecom) which have provided recorded music either themselves or by acquiring the ability to provide the music source from a supplier other than Telecom;

     (d)  broadcast music played in otherwise similar circumstances to those in para (c);

     (e)  recorded or broadcast music played to callers using mobile telephones in each of the circumstances described in paras (a) to (d).

     It was agreed that APRA was the owner of certain of the exclusive economic rights conferred on copyright owners of literary and musical works by s.31 of the Copyright Act.  These rights include the right conferred by subpara. (1)(a)(v) of the section to cause the work to be transmitted to subscribers to a diffusion service ("the diffusion right") and the right conferred by subpara. (1)(a)(iv) to broadcast the work ("the broadcast right").  It is to be observed that the works in question are works in the true copyright sense; the case does not concern sound recordings which are dealt with in Part IV of the Copyright Act as subject-matter other than works.  Accordingly, ss. 85, 89, 93, 97 and 101 have no relevance to the present proceedings.  The APRA repertoire includes the musical work i.e. the musical composition of the music and the lyrics comprised in the literary work composed by the various song writers.

     Telecom is the holder of a general telecommunications licence issued on 25 November 1991 under the Telecommunications Act.  Until recently, Telecom was the only general carrier of telecommunications in Australia.  Consequently, the network used for telecommunications was supplied and maintained by Telecom.  By s.123 of the Telecommunications Act the network is owned by Telecom.  His Honour said that, in the case of domestic customers, the network ends at the first telephone socket, and in the case of commercial customers, at the main distribution frame used to connect external telephone lines.  The customer is the owner or lessee of, and is responsible for, all equipment beyond the first socket or the main distribution frame whichever the case may be. 

     In the course of his judgment his Honour explained the way in which the telephone system works technologically.  I do not find it necessary to refer to that part of his judgment except to note his finding that the electromagnetic current carrying music never passes to the premises of the subscriber.  Furthermore, the person operating a telephone at the subscriber's premises will never hear the music on hold unless it is relayed over an organisation's internal telephone network as well as to callers from outside.  Subject to that matter, the current carrying the music moves directly from the Telecom exchange to the caller.

     I next refer to the relevant provisions of the Copyright Act.  I have already referred to the provisions of subparas (a)(iv) and (v) of subsec. 31(1).  In terms they provide:

     "31. (1)  For the purposes of this Act, unless the contrary intention appears, copyright, in relation to a work, is the exclusive right:

     (a)  in the case of a literary, dramatic or musical

          work, to do all or any of the following acts:

             ...........................................

             (iv)  to broadcast the work;

             (v)   to cause the work to be transmitted

                   to subscribers to a diffusion service;"

     The word "broadcast" is defined in s.10 of the Copyright Act to mean "transmit by wireless telegraphy to the public".  Neither the word "diffusion" nor the expression "diffusion service" is defined in s.10 but detailed provisions concerning diffusion services are found in s.26 which is as follows:-

     "26. (1)  A reference in this Act to the transmission of a work or other subject-matter to subscribers to a diffusion service shall be read as a reference to the transmission of the work or other subject-matter in the course of a service of distributing broadcast or other matter (whether provided by the person operating the service or by other persons) over wires, or over other paths provided by a material substance, to the premises of subscribers to the service.

     (2)  For the purposes of this Act, where a work or other subject-matter is so transmitted:

     (a)  the person operating the service shall be deemed to be the person causing the work or other subject-matter to be so transmitted; and

     (b)  no person other than the person operating the service shall be deemed to be causing the work or other subject-matter to be so transmitted, whether or not he provides any facilities for the transmission.

     (3)  For the purposes of the application of this section, a service of distributing broadcast or other matter shall be disregarded where the service is only incidental to a business of keeping or letting premises at which persons reside or sleep, and is operated as part of the amenities provided exclusively for residents or inmates of the premises or for those residents or inmates and their guests.

     (4)  A reference in this section to the person operating a service of distributing broadcast or other matter shall be read as a reference to the person who, in the agreements with subscribers to the service, undertakes to provide them with the service, whether he is the person who transmits the broadcast or other matter or not.

     (5)  Where a service of distributing matter over wires or over other paths provided by a material substance is only incidental to, or part of, a service of transmitting telegraphic or telephonic communications, a subscriber to the last-mentioned service shall be taken, for the purposes of this section, to be a subscriber to the first-mentioned service."

     Before Gummow J, APRA, in addition to relying on the broadcast right and the diffusion right, relied upon the provisions of subpara. 31(1)(a)(iii) which confers on the owners of musical and literary works the exclusive right to perform the work in public.  Reliance on that provision was not maintained on appeal.

     I propose to deal first of all with the question whether the playing of music on hold in the various situations which I have postulated other than that which involves the use of a mobile telephone involves Telecom in causing the relevant works to be transmitted to subscribers to a diffusion service.

     Counsel for APRA relied on the provisions of subsec. 26(5) of the Copyright Act, but also submitted that it was sufficient for it to rely upon subsec. 26(1) along with the provisions of subsecs 26(2) and 26(4).  Counsel for Telecom said that, for the Court to be satisfied that it should accept APRA's submission, three elements must be present.  Firstly, there had to be a diffusion service; secondly, the recipients of the work, that is those who listen to the music on hold, must be subscribers to that diffusion service; and, thirdly, the alleged infringer must have caused that work to be transmitted to those subscribers.  Counsel contended that none of those elements was present.

     Counsel submitted that the service provided was a service to the recipients of the matter which was transmitted and not to the senders of it.  The terms of subsec. 26(1) required the matter to be transmitted to the premises of subscribers to the service.  That, so counsel said, was in accordance with the ordinary concept of a diffusion service.  Nobody subscribed to receive music on hold.  The persons concerned were the senders.

     It should, I think, be said at the outset that one would not lightly take the view that this very extensive use, albeit by new technology, of such conventional works as lyrics and music was outside the purview of the bundle of exclusive rights conferred on copyright owners by s.31 of the Copyright Act.  Nevertheless, if the use in question is not within the rights conferred by that Act, there will be no infringement.

     For the moment I propose to omit from consideration cases where there is an element of radio broadcasting or transmission by wireless in what occurs.  There are two situations requiring consideration.  The first is where a caller hears music played, not by means of a tape recorder or compact disc player, but as part of a radio program broadcast from one of the national or commercial broadcasting stations.  The second occurs where the caller uses a mobile telephone to make the call.  In such circumstances, the call will be partially transmitted by wireless.  Such a caller may, of course, also hear music played from one of the radio stations, that being the source of music selected by the telephoned organisation for its callers to hear whilst they wait for attention.  I shall refer to these cases in due course. 

     I am concerned with cases:

     (a)  where the music is provided by Telecom itself when its customers are placed on hold when they telephone one of its offices or service centres;

     (b)  where the call is made to an organisation which has availed itself of the CustomNet service made available by Telecom; or

     (c)  where an organisation causes music on hold to be played to customers from a source not provided by Telecom, e.g. by means of a tape recorder or compact disc player operated by it or by means of a service similar to CustomNet but provided by a different supplier.

     In my opinion, the answer to the difficult problem to which the case brought by APRA gives rise is to be found upon a proper analysis of s.26 of the Act.  If one considers the words of subsec. 26(1) of the Act without taking into account the words in parenthesis, one sees that the subsection is (a) describing a service which involves the transmission of a copyright work or subject matter (clearly that is the case here - recorded music is what is transmitted); (b) the transmission of the work or subject matter over wires or other paths (that element is present); (c) to the premises of subscribers to the service.  There are two aspects of this.  The first is the meaning to be ascribed to the expression "the subscribers to the service", that is the diffusion service; and the second, the significance to be ascribed to the reference to "premises" in the provision.

     The persons who perforce listen to music on hold are not themselves subscribers to the service.  They are strangers to it.  They do not solicit it and they do not subscribe to it.  Their purpose in telephoning the number is to deal with the organisation, Telecom or otherwise, with which they have business.  They may regard their experience as a pleasant interlude, they may tolerate it with varying degrees of patience, or they may find the whole experience utterly frustrating.  But the fact remains that they do not telephone the number they have rung to hear music; and they certainly did not subscribe to any service of the kind which is provided.  It follows that the callers themselves cannot be the subscribers to any such service.   In this respect, it should be clear that the service which is referred to in subsec. 26(1) is not, and could not properly be construed to be, the telecommunications service.  I would reject the notion implicit in APRA's submission that, by subscribing to the telecommunications service, subscribers to that service in some way become, or are deemed to have become, subscribers also to a diffusion service within the meaning of the Copyright Act.

     The matters to which I have so far referred provide the starting point for the consideration of the problem, but, as will be seen, they place, in my opinion, what I regard as an insuperable obstacle in the path of APRA's submission.  The work which s.26 of the Act is intended to do is to spell out with some care the content of the exclusive right conferred by subpara (1)(a)(v) of s.31 of the Act.  That right is to cause the work to be transmitted to subscribers to a diffusion service.  What the subparagraph contemplates, and this is confirmed by subsec. 26(1), is the distribution, inter alia, of recorded music to the premises of subscribers to the service.  In my opinion, these two critical provisions of the Act were not intended by the draftsman of the legislation to deal with a case of this kind.  Rather, they were designed to deal with cases where a person provided a service to those wishing to listen to music or other recorded material, or to watch film or video, by providing them, whether on payment of a fee or not, with a facility for listening to or watching such material over wires or other paths provided by a material substance to the premises of the subscribers.  The object of the legislature in conferring on copyright owners the exclusive right provided for in subpara. 31(1)(a)(v) was to ensure that, if such a service were provided and did include copyright material, copyright owners were protected against the unauthorised use of their work.  This is not that case.

     I do not think that one can take anything from the fact that the subsection refers to the premises of subscribers to the service as distinct from the subscribers to the service themselves.  If anything, the presence of the word "premises" adds force to Telecom's submission.  It shows that what was intended to be covered was the physical transmission of copyright material from some central source to the premises of the various subscribers to the service.

     The words in parenthesis in the subsection do not affect this conclusion.  The words are "whether provided by the person operating the service or by other persons".  In my opinion, they were inserted for the purpose of making it clear that the provision was dealing not only with copyright material originated by the person providing the service but also with copyright material originating from others in the sense that it was owned by those other persons.

     One needs, of course, to consider s.26 as a whole.  In my opinion there is nothing in the remaining subsections of it which affects the conclusion to which I have come.  Subsection 26(2) refers to the person operating the service and deems that person to be the person causing the work or other subject matter to be so transmitted.  An analysis of the Telecommunications Act would suggest that the telephone service is operated by Telecom.  But the fact that Telecom operates the telephone service will not turn the provision of music on hold by Telecom or anyone else into a diffusion service for the purposes of the Act.  And it will not turn those who listen to music on hold into subscribers to a diffusion service because they do not subscribe to any such service.

     Subsection 26(3) has no relevance to the circumstances of the present case.

     Subsection 26(4) of the Act tends to confirm the view which I have taken.  It makes the person operating a service of distributing broadcast or other matter the person who, in the agreements with subscribers to the service, undertakes to provide them with the service, whether he is the person who transmits the broadcast or other matter or not.  This subsection emphasises the fact that it is intended that there be agreements with subscribers to the service which must be a service of providing subscribers with copyright material.  The purpose of the subsection is to make it immaterial whether that person actually transmits the broadcast or other matter or whether that is done by some other person.

     Much was made of subs. 26(5) but, so it seems to me, it cannot control the whole meaning of the section nor be read so as to confer rights which are not to be found even incidentally in the provisions of s.31, which, after all, is the provision which confers the right, or in the remaining provisions of s.26.  In this respect I am in respectful agreement with Gummow J.  He said (at 137):

     "Even if the provision of music on hold was properly seen as a service of distributing matter, there is no agreement or undertaking to provide this service for the purposes of subs (4).  Subsection (5), in deeming a person to be a subscriber to the service, cannot be taken to also deem an agreement with the subscriber and an undertaking to provide them with the service, for the section provides no guidance as
to who would be deemed to have made such an undertaking.  The very process of identification of the person who is to be taken to be operating this service set down in subs (4) requires an analysis of the agreement to ascertain who is undertaking to provide the service, an analysis which cannot be performed upon a deemed agreement.

     There is force in a submission by counsel for Telecom that subs (5) may apply where there is a subscription to a combined diffusion service and telecommunications service.  This subsection may also apply where there are two separate subscriptions, one being to a telecommunications service and the other being incidental to or part of this service.  However, these examples are a long way from the present case."

     I should perhaps make one small qualification to my agreement with what Gummow J has said in these paragraphs.  It concerns the first sentence of the quotation where his Honour said that, even if the provision of music on hold was properly seen as a service of distributing matter, there was no agreement or undertaking to provide the service for the purposes of subsec. 26(4).  It is unnecessary, in the view I take of the matter, for me to express views on the meaning of "distributing matter" in this context and I do not.  For the purpose of what he said, Gummow J was prepared to assume that the service was one of distributing matter.  That is sufficient for my purposes.

     Before proceeding to the broadcasting part of the case, I should indicate that I have given consideration to the history of the diffusion right in the legislation.  The right was conferred for the first time by the 1968 Act i.e. the current Act.  Many of the original provisions of that Act, of which the diffusion right is one, are taken from the 1956 English Act (the Copyright Act 1956 (UK)).  The English Act came about after the report of the Copyright Committee, 1951.  The report is in fact dated 31 July 1952 and is known as the Gregory Report after its chairman.  Before the Bill for what became the 1968 Australian Act was introduced, the whole matter of copyright was considered by an Australian committee (Report of the Committee Appointed by the Attorney-General of the Commonwealth to Consider what Alterations are Desirable in the Copyright Law of the Commonwealth).  The report was made in 1959 and is known as the Spicer Report after its chairman, the Honourable Sir John Spicer, the then Chief Judge of the Commonwealth Industrial Court.

     There is little reference to the diffusion right in the Spicer Report.  In para. 62 (at 17) the Spicer Committee referred to s.2(5) of the 1956 English Act.  There were set out its provisions in relation to acts restricted by the copyright in literary, dramatic or musical works.  These included the diffusion right.  All the Spicer Committee said was that it recommended the adoption of that provision along with the other provisions of the English section.  These eventually became the exclusive rights provided for in s.31 of the Australian Act.

     The Gregory Committee, to the extent that it dealt with diffusion rights, dealt with them in Part VII which was entitled "Performing and Performers' Rights".  I do not find it useful to refer to any specific paragraph of that part of the report.  But the whole problem of public performance in places such as restaurants, bars and hotel rooms is there discussed along with many other matters. 

     After the 1956 English Act was passed, the 9th Edition of Copinger and Skone James on Copyright was published in 1958.  The diffusion right and the infringement of it are dealt with by Copinger at 193-196.  I do not need to refer to the detail of what is there said.  It is enough to say that it is said that the diffusion right only applies where there is a transmission to the premises of subscribers to the service so that it would not apply in the case of a transmission by a proprietor of a hotel to separate rooms in the hotel; see at 193-4.  The treatment of the diffusion right and the infringement of it in the 10th Edition of Copinger and Skone James on Copyright, which was published in 1965, is to the same effect although the discussion is more detailed; see paras 531 and 535 (at 206 and 208).  The 9th Edition was available to the Spicer Committee before its report was published.  A passage from it (not relevant to the present problem) was quoted in para. 379 of the Report.  The 10th Edition was available to Parliament and to those responsible for the drafting of the Bill for the 1968 Act before the Bill was introduced into Parliament in 1967. 

     In the course of his second reading speech, the Attorney-General (the Honourable N.H. Bowen QC, as he then was) said (Hansard for House of Representatives, 18 May 1967, at 2329) that clause 30 of the Bill (it became s.31 of the Act) set out the rights which were conferred upon the owner of the copyright in an original work.  In respect of literary, dramatic and musical works, the copyright owner was given exclusive rights of reproduction, publication, public performance, broadcasting, and communication of the works to subscribers to a diffusion service, "that is, a service in which transmission is effected by land line and not by broadcasting."  A reading of the Second Reading Speech indicates that the new Bill was very substantially based on the provisions of the 1956 English Act.  That is in line with the general thrust of the Spicer recommendations.

     The respective provisions of s.48(3) of the 1956 English Act, and s.26 of the Australian Act, which may be regarded as its counterpart, are not in identical terms, or necessarily to the same effect (see also s.48(5)).  Plainly enough, the critical task in this case is to construe correctly the provisions of s.26.  Nevertheless, when one takes into account the history of the way in which these provisions came to be inserted into the Act and the apparent purpose of those, both in England and Australia, responsible for enacting them, it seems very difficult to impute to those responsible for the drafting of s.26 an intention to provide for a situation such as that contended for by APRA here.  A facility such as music on hold was unknown when the copyright legislation in question was passed.  Whilst I am quite prepared to give the Act a beneficial construction so that it will embrace cases arising because of new technology when its language is tolerably clear, I do not think it right to take this course unless one can be satisfied that the right which is said to exist is one which reasonably arises from the language which Parliament has used.  I am not satisfied that the right here contended for does so.

     I would add that there are large questions of policy involved in this matter.  If Parliament were considering whether to amend the Act to provide for what APRA wishes to achieve, it is likely that considerable thought would be given by it to the whole question of how owners of copyright material used by persons providing music on hold should be compensated for this use.  One of the critical matters would be whether the operator of a comprehensive telephone service such as Telecom should be required to pay what will prove to be a very large sum of money payable regularly for the indefinite future for something which appears to have little to do with it except that it happens to be the operator of the telephone service.  Furthermore, it is not unlikely, unless agreement can be reached between APRA and Telecom, assuming the APRA submissions prevail, that the recognition of the right will cast a large administrative burden on those responsible for the payments, not only because of the need to ensure that the amounts which are paid are correct, but in determining how Telecom itself should deal with those responsible for providing music on hold services.  At bottom is the question of fair or equitable remuneration (expressions used elsewhere in the copyright legislation) for uses of copyright material.  This should be adequate, but it should not be excessive.   The underlying difficulties of this whole problem are numerous.  It follows that there is much to be said for the view that the matter ought to be dealt with by legislation rather than judicial decision unless the right contended for is provided for in the legislation with reasonable clarity.  A court ought not to be astute to find it.

     My conclusions thus far mean that the case brought by APRA in respect of all but what I might call broadcasting uses of the material must fail.  That conclusion must be the same in the case of the transmission to callers placed on hold of music which is being played by one or other of the radio stations.  In my opinion APRA cannot rely upon the broadcasting right in relation to this type of case.  That is because there is no infringement of the broadcast right.  However the matter is looked at, Telecom does not broadcast the music.  It transmits the music over what I have termed, for want of a better expression, a landline.  So it is the diffusion right which must be relied upon for this use.  In this respect it may be observed that subsecs (1), (3) and (4) of s.26 of the Copyright Act each use the expression "broadcast or other matter".  For reasons earlier given, the evidence does not establish any infringement of the diffusion right.

     In this respect I have had regard to subsec. 199(4) of the Copyright Act which provides that a person who, by the reception of an authorised television broadcast or sound broadcast, causes a literary, dramatic or musical work or an adaptation of such a work, to be transmitted to subscribers to a diffusion service shall be treated, in any proceedings for infringement of the copyright in the work, as if the person had been the holder of a licence granted by the owner of that copyright to cause the work to be transmitted by the person to subscribers to that service by the reception of the broadcast.  The subsection proceeds upon the hypothesis that there is a diffusion service within the meaning of s.26 and subpara. 31(1)(a)(v) of the Act.  If there is and if broadcast matter is transmitted by it, the subsection is intended to overcome a difficulty which might otherwise exist. 

     In passing, I should say, however, that it is not clear to me what the scope of the operation of subsec. 199(4) is.  I have some difficulty in reconciling the subsection with those provisions of s.26 which refer to distributing broadcast or other matter.  Assuming a diffusion service within the meaning of the Copyright Act, those provisions seem to contemplate that the copyright owner has the exclusive right to control the distribution of all copyright material transmitted over the service including copyright material which has been received by the operator of the service by way of a broadcast.  Because of my conclusion that there is no infringement of the diffusion right in the present case, subsec. 199(4) is, in my opinion, of no relevance to the outcome of the case.  I do not, therefore, express any view as to its meaning or operation.

     That leaves cases where a mobile telephone is used to make a call and the caller receives music whilst placed on hold.  The question is whether or not music played on hold to callers on mobile telephones constitutes an infringement of APRA's broadcast right as distinct from its diffusion right.  Unlike the diffusion right, the broadcast right is uncomplicated.  Importantly no question arises concerning subscribers to a broadcast service.

     Earlier I referred to the definition of "broadcast" in s.10 of the Copyright Act.  There are some further provisions of that Act to which reference needs to be made.  As mentioned, "broadcast" is defined in s.10 of the Copyright Act to mean to transmit by wireless telegraphy to the public.  "Wireless telegraphy" is defined in s.10 to mean the emitting or receiving, otherwise than over a path that is provided by a material substance, of electromagnetic energy.  It may be noted that the words "otherwise than over a path that is provided by a material substance" are plainly intended to distinguish wireless telegraphy from diffusion.  Section 10 also defines the terms "sound broadcast" and "television broadcast".  A sound broadcast is a sound broadcast otherwise than as part of a television broadcast. 

     Subsection 22(5) of the Copyright Act provides that, for the purposes of the Act, a television broadcast or sound broadcast shall, subject to subsec. (6), be deemed to have been made by the person by whom, at the time when, and from the place from which, the visual images or sounds constituting the broadcast, or both, as the case may be, were broadcast.  Subsection 22(6) deals with satellite broadcasts and is not relevant for present purposes.

     Reference needs also to be made to s.25.  It is as follows:

     "25 (1) A reference in this Act to broadcasting shall, unless the contrary intention appears, be read as a reference to broadcasting whether by way of sound broadcasting or of television.

     (2) A reference in this Act to the doing of an act by the reception of a television broadcast or sound broadcast shall be read as a reference to the doing of that act by means of receiving a broadcast--

     (a)  from the transmission by which the broadcast is made; or

     (b)  from a transmission made otherwise than by way of broadcasting, but simultaneously with the transmission referred to in the last preceding paragraph, whether the reception of the broadcast is directly from the transmission concerned or from a re-transmission made by any person from any place."

     Gummow J said (at 141) that transmissions to mobile telephones by base stations involve the emitting of electromagnetic energy.  He said that they thus constituted transmissions by wireless telegraphy.  He said that the remaining issue was whether the transmissions were transmissions "to the public".  In saying what he did, his Honour inferentially equated a transmission by wireless telegraphy with a broadcast so long as the transmission was to the public.  He did so because the definition of "broadcast", which is an exhaustive one, requires it to be so treated if the transmission is to the public.  Of course, not every transmission by wireless telegraphy will be a broadcast whether in the ordinary or the defined sense of the word.  My understanding is that most overseas telephone calls are made by satellite.  They involve the use of wireless telegraphy.  They are not broadcasts in ordinary language because it would be an incorrect use of language so to describe a transmission by one person to another.  They are not broadcasts in the defined sense because no such transmission could be "to the public" no matter what the meaning to be ascribed to that expression should be.  The same would also be true of radiocommunications by an air traffic controller to aircraft or a port traffic controller to ships unless the message were a general one, for example, warning of a change in the weather or of some unexpected hazard.

     Telephone calls are private affairs.  They may be made for many purposes.  A substantial number of calls will be made for business purposes using that expression in a wide sense in order to distinguish them from those made for domestic purposes.  But, whether they are made for business or domestic reasons, they remain private in character. 

     Prior to the Copyright Amendment Act 1986, "broadcast" was defined in s.10 of the Copyright Act to mean "broadcast by wireless telegraphy".  "Broadcasting" had a corresponding meaning.  Although the definition was an exhaustive one, it left the question of the meaning of the word "broadcast" to be determined in accordance with ordinary principles.  It is a plain English word and it was to be given its plain and ordinary meaning.  According to the Oxford English Dictionary, its figurative meaning is "scattered widely abroad, widely disseminated".  When radio became available, it was given a special meaning in relation to it i.e., "Disseminated by means of radio or television", and also the "action or an act of broadcasting by radio or television".  When used as a verb "broadcast" meant "to disseminate (a message, news a musical or dramatic performance, or any audible or visible matter) from a radio or television transmitting station to the receiving sets of listeners and viewers;...".  The dictionary gives a number of examples of the use of the word in this context in the early 1920s.

     As the definition stood in 1986, no attention needed to be paid to the question whether the broadcast was to the public.  The reason for that is understandable.  Most broadcasts were received in the privacy of peoples' homes.  It was the exclusive right to use copyright material for this purpose which was conferred on the owners of the copyright in it.  No question of a broadcast to the public needed to be considered any more than it was in relation to the diffusion right which makes no reference to the public.  It refers to a transmission of a work to the subscribers of a diffusion service.  Both the broadcast right until 1986 and the diffusion right down to the present time may be contrasted with the public performance right provided for in subpara. 31(1)(a)(iii) of the Copyright Act.  It was upon that right that copyright owners relied for protection of their work when it was broadcast until the broadcast right was enacted in the 1968 Act.  Cases relating to broadcasting before the broadcast right was provided for showed the difficulty courts had in endeavouring to overcome the problem by resort to the public performance right.  Those cases included Chappell & Co. Ltd. v Associated Radio Co. of Australia Ltd [1925] VLR 350 and Mellor v Australian Broadcasting Commission [1940] AC 491 discussed by Gummow J (at 142-3).

     Mellor was a judgment of the Privy Council on appeal from a judge of the Supreme Court of New South Wales.  The facts of the matter were that the Commission engaged bands to play some of the copyright works of the appellants in studios or in other places with a view to the broadcasting of the performances.  The bands, or the members of the bands, had purchased the pieces of music on the terms and with the guarantee set out in the appellants' pamphlets or journals.  One of the questions discussed by the Privy Council was whether there was a public performance of the work.  The Privy Council said (at 500-501):

     "Here it is necessary to remember that the sole right of the owner of the musical work is to perform it in public, and that anyone may perform the work in private.  The original performance in the studio may be, and generally will be, a performance in private.  In such a case the broadcast performance at the receiving end, if in public and unlicensed, will be an infringement of copyright at that place:  Performing Right Society, Ld. v Hammond's Bradford Brewery Co. [1934] 1 Ch. 121.  If there is merely a broadcast from the studio where the piece is performed in private, there is obviously no performance in public at all.  A broadcast per se is not an acoustic representation of the work.  If the broadcast is picked up only by listeners in private it might be difficult to establish that there is a public performance; for each performance would be separate, and each would be private; but it is not necessary to express an opinion on this point.  It cannot be doubted that a broadcast to all and sundry listeners in such a case as we are dealing with will include hotels and other places of entertainment or refreshment who, if not forbidden, will perform the piece to a number of members of the public; and it is clear that such a performance will be a public performance within the meaning of the Copyright Act by the owners or occupiers of those places; for their actions in connection with the receivers which have been installed there, and which they control, have caused the public performances to take place.  Whether the studio performance is public or private, if the persons who are responsible for that performance are also responsible for the broadcasting of the piece, there is no doubt that they have facilitated the performance of the work in public by any listener who is in a position to use a loud speaker and thus to perform the piece in public."

     These problems disappeared with the enactment of the broadcast right.  It contemplated that a broadcaster broadcasting music to listeners to radio programs in all conceivable circumstances would be guilty of infringement of copyright unless the broadcast were authorised or licensed by the copyright owner.  If this case had had to be decided before the 1986 amendment took effect, there would have been a question whether the playing of music on hold over a mobile telephone to a waiting caller was a broadcast in the sense in which that expression is understood in every day usage.  One might have been tempted to conclude that there was no difference of substance between the case of a jogger using a walkman radio and a waiting caller listening, albeit impatiently, to music played over a mobile telephone.  But there would have been a difficult question, the answer to which may have depended at least in part on a detailed understanding of the technology, whether what was being transmitted to the caller was a broadcast.  I do not need to decide that question.  The new definition brought about two important changes.  The first was the omission of the word "broadcast" from the definition.  The word "transmission" was used instead.  The second change was the addition of the words "to the public" to the definition. 

     The first of these changes makes it impermissible to take account of the ordinary meaning of the word "broadcast" in ascertaining whether a particular activity amounts to a broadcast.  There is a broadcast whenever there is a transmission by wireless telegraphy to the public.  In the present case the answer to the question whether there is here an infringement of the broadcast right will be determined by the significance to be accorded to the words "to the public" in the context of the facts of this case.

     It is necessary to notice how the words "in public" came to be added to the definition of "broadcast".  The Copyright Amendment Act 1986 added the words "other than from point to point" after the words "means broadcast" in the then definition.  The definition then read, "broadcast means 'broadcast' other than from point to point by wireless telegraphy, and 'broadcasting' has a corresponding meaning."  Additionally, the amending Act inserted a new subsec. 10(1a) which was as follows:

     "For the purpose of the definition of 'broadcast' in sub-section (1), a broadcast shall be taken to be from point to point if it is intended by the broadcaster to be received only by particular equipment at a particular location."

     The reason for these amendments is explained in the explanatory memorandum circulated at the time the amending Act was being debated.  It was said (at 7) that amendments to broadcasting legislation and the introduction of broadcasting via "AUSSAT" had highlighted possible uncertainty as to the meaning of the then definition which provided that "broadcast" meant "broadcast by wireless telegraphy".  It was further said that it was proposed to make clear that only transmissions intended to be received by the public (whether the general public within the meaning of the Broadcasting Act 1942 or part of the public) were covered and not those intended for a particular recipient which were referred to as "point-to-point" transmissions such as, "typically", microwave communications.

     Neither the amended definition of "broadcast" nor subsec. 10(1a) remained in the Copyright Act for very long and neither came into force.  The Statute Law (Miscellaneous Provisions) Act (No. 2) 1986 omitted the new subsec. 10(1a) and substituted for the then definition of "broadcast", the present definition.  The reason for this further amendment was explained in an explanatory memorandum which accompanied the introduction of the Statute Law (Miscellaneous Provisions) Bill (No. 2) 1986.  It was there said (at 21) that proposed amendments of s.10 substituted a new definition of "broadcast" to better express the intention that only wireless transmissions to the public were covered by the Act.  Accordingly "programme-carrying signals" not intended to be received "by the copyright owner's public" would not be "broadcasts" even if a few members of the public possessing specialised equipment were able to pick them up.  The Bill provided that the amendment would commence immediately after the date to be proclaimed for the commencement of the Copyright Amendment Act 1986.

     In addition to the matters earlier noted, the new definition omitted that part of the old definition which said that "broadcasting" was to have a corresponding meaning to "broadcast".  It does not seem to me that that omission has any significance.  What is significant is the second reading speech made by the Attorney-General at the time the Bill for the Statute Law (Miscellaneous) Provisions Act was introduced. The Attorney-General said that the amendment would clarify the
definition of "broadcast".  He referred to the fact that interested groups had submitted that the wording inserted by the Copyright Amendment Act was ambiguous and did not express the Government's intention that "broadcast" in this context should cover transmissions "to the copyright owner's public, whether the 'general' public or part of the public."  See Hansard, House of Representatives, 15 October 1986, 2067.

     So a transmission to the public was intended to mean a transmission to the copyright owner's public.  Long before the amendment was passed, the expression "copyright owner's public" had a well understood meaning.  This had developed because of the need to give meaning to the expression "perform the work in public" in subpara. 31(1)(a)(iii) of the Act.  Because of this history, it seems likely that the words "to the public" in subpara. (iv) would have been given a like meaning irrespective of the Attorney-General's statement in his second reading speech.  But it may be true to say that in the context in which it appears there is a degree of ambiguity about the phrase in the definition.  If that be so, the matter is put beyond question by reference to the Attorney-General's words.  The words "to the public" mean to the copyright owner's public.  The expression in subpara. (iii) is, of course, not "to the public" but "in public".  I do not think that any distinction of substance should be drawn because of this difference.  If it were, I would take the view that the expression "to the public" more strongly indicates the
copyright owner's public than does the expression "in public" used in subpara. (iii). 

     In Rank Film Production Limited v Colin S. Dodds [1983] 2 NSWLR 553 Rath J held that the exhibition of films without a licence from the copyright owners thereof in motel rooms by means of transmission by a video cassette recorder to a receiving apparatus provided by the occupier of the motel in the rooms was an infringement of the copyright in those films by the motel occupier because there was a performance of the films in public.  Rath J was not concerned with the exclusive right provided for in subpara. 31(1)(a)(iii) but with the similar right conferred on the owners of the copyright in films by para. 86(b) of the Act.  Films are not dealt with in Part III of the Act which deals with works but in Part IV which deals with copyright in subject matter other than works.  Nevertheless, the considerations are the same whether the matter is being considered as one arising under s.31 or under s.86.

     Rath J's judgment contains, with respect, a helpful analysis of the law relating to the meaning of "the public" in relation to the public performance right.  I propose to refer to the discussion in the judgment in a little detail.

     Some of the authorities dealing with the matter concern questions whether particular performances to a group are in public or private.  Thus, in Duck v Bates (1884) 13 QBD 843, a case under the Dramatic Copyright Act 1833 (UK), the Court had to consider the performance of a dramatic work at a hospital for the entertainment of nurses and others connected with the hospital.  Admission was free.  About 170 persons attended.  A majority of the English Court of Appeal held that the performance was not in public but in private.  Brett MR said (at 847) that there must be present a sufficient part of the public who would go also to a performance licensed by the author as a commercial transaction.  Otherwise the place where the drama was presented would not be a place of "dramatic entertainment" within the meaning of the statute.  Bowen LJ said (at 850) that there was a broad distinction between the case under consideration and a performance to which the public at large or any portion of the public were invited.   On the other hand, Fry LJ thought (at 854) that the question was whether there was a probable interference with the proprietary rights of the author.

     Of more significance is the decision of the English Court of Appeal in Harms (Incorporated) Limited v Martans Club Limited [1927] 1 Ch 526.  The Court was concerned with the question whether a performance of a musical play in a club was a "representation in public" within the meaning of the Copyright Act 1911 (UK) in derogation of the right of public performance given to the owner of the copyright.  Lord Hanworth MR said (at 532-533):

     "It appears to me that these authorities [Planché v Braham (1837) 4 Bing N.C. 17, Wall v Taylor 11
Q.B.D. 102 and Duck v Bates] are an abundant foundation for what Eve J. has determined--namely, that the question whether there was a performance in public is largely a question of fact and to be determined by the facts of each case.

     It appears, therefore, that one starts with the question:  What is it that has been secured to the author; what is it in respect of which he is entitled to protection?  In considering here whether or not there has been within s.2, sub-s. 1, an infringement of the author's sole right, one must see whether or not, upon the facts as a whole, the true view is that there has been a representation of this composition in public.  In dealing with the tests which have been applied in the cases, it appears to me that one must apply one's mind to see whether there has been any injury to the author.  Did what took place interfere with his proprietary rights? As to that, profit is a very important element.  Next, you must consider whether there has been admission of any portion of the public, with or without payment, and when you are considering what you mean by any portion of the public you will find in Duck v Bates 13 Q.B.D. 843, 847 that according to Brett M.R. it means the public who would go either with or without payment--the class of persons who would be likely to go to a performance if there was a performance at a public theatre for profit.  Then one has also to consider whether or not the performance is a domestic one so as to exclude the notion of 'public'--domestic in the sense that it was private and domestic, a matter of family and household concern only.  Then again you must consider where the performance took place, bearing in mind that the place need not be one which is kept habitually for the exhibition of dramatic entertainments.  I do not say that I have catalogued all the suggestions made as tests of the facts to be considered, but it appears to me that I have tabled enough to support the conclusion that Eve J. was right in his judgment."

     After citing part of this passage, Rath J said (at 558):

     "Applying those tests here, there would appear to be an interference with the plaintiffs' proprietary rights, because the statement of agreed facts shows that there is a market for the display of films in motel rooms.  Next, although only one or two persons saw the films, they did so as guests of the motel, that is to say, as members of a section of the
public.  And though the performance was in private, it was arranged as part of a commercial transaction.  The performance could hardly be said to be a matter of family and household concern only.  The place was protected from public gaze, but it was after all a room in a motel, not the home of the guest."

     Rath J then referred to Performing Right Society Ltd v Hawthorns Hotel (Bournemouth) Ltd [1933] Ch 855 where Bennett J held that there was a performance in public by an orchestral trio playing to guests in an unlicensed hotel.  Bennett J had said (at 857) that any respectable member of the public who was prepared to pay the price charged by the defendants either for consuming meals in their hotel, or for staying there, was at liberty to listen to the music performed by the trio engaged by the defendants.  Rath J added (at 558), "So here it may be presumed that any respectable member of the public who was prepared to pay the price charged by the defendants for a room might become a guest and look at the in-house movie".

     In Jennings v Stephens [1936] Ch 469 Greene LJ (as he then was) said (at 485):

     "The question may therefore be usefully approached by inquiring whether or not the act complained of as an infringement would, if done by the owner of the copyright himself, have been an exercise by him of the statutory right conferred upon him.  In other words, the expression 'in public' must be considered in relation to the owner of the copyright.  If the audience considered in relation to the owner of the copyright may properly be described as the owner's 'public' or part of his 'public', then in performing the work before that audience he would in my opinion be exercising the statutory right conferred upon him; and any one who without his consent performed the work before that audience would be infringing his copyright."

     Rath J went on to say (at 559) that, in the case before him, the motel guest in his room might easily be envisaged as part of the copyright owner's public.  It was not the restricted size of the audience, or the privacy of the surroundings, that was decisive on the issue; the critical matter was the presentation of the movie by the occupier of the hotel to his guest in that capacity.  He referred to the decision of the English Court of Appeal in Ernest Turner Electrical Instruments Ltd v Performing Right Society Ltd [1943] Ch 167 where Greene MR (as Greene LJ had then become) said (at 171) that he proposed to base his judgment on Jennings v Stephens.  Later he said (at 172):

     "When those considerations are borne in mind, the answer to the present question appears to me to be beyond doubt.  It is a question of law whether these performances are performances 'in public' within the language of the statute, but, in answering that question of law, the chief guide to the court is the guide of common sense.  Some cases on their facts fall on one side of the line, and some on the other.  In the present case, having regard to the character of the audience and all the relevant facts which bear on the matter, I have no doubt that these performances were performances 'in public'.  In Jennings v. Stephens I ventured to suggest that the primary matter to consider was the relationship of the audience to the owner of the copyright rather than the relationship of the audience to the performers.  I am confirmed in that view by a consideration of the present cases."

     Goddard LJ, after referring to Jennings v Stephens, said (at 175-6):

     "Is the audience one which the owner of the copyright could fairly consider a part of his
public?  If it be objected that guests in a private house would be a part of that public, the answer I think is that, in selling a piece of music or a gramophone record, the owner of the copyright contemplates that it will be played, and consents to its being played, by the purchaser and he expects, not that it will be enjoyed in solitude, but that it will be heard by members of the purchaser's household and his guests.  If an action for damages or penalties were tried by a jury, and this direction were given to them, they could without difficulty and by a mere application of their common sense decide whether the audience in any particular case exceeded what could fairly be described as a private or domestic audience.  Exactly the same considerations apply to broadcasting.  The principal object of the Act is to safeguard the property of authors or their transferees in their copyright, and, if employers of labour were entitled to cause compositions to be performed before their employees without any expense beyond buying a piece of music or a record or paying for a licence for a wireless receiving set, an author would very soon have his public seriously diminished and the protection of the Act would be largely illusory."

     The case was one where an employer had relayed broadcast music to its employees during the course of their employment in its factory.

     In Australasian Performing Right Association Ltd v Canterbury-Bankstown League Club Ltd (1964) 81 WN (Pt 1) (NSW) 300, Ferguson J, in whose judgment Herron CJ agreed (at 301), said (at 306):

     "It seems to me to be conclusively established by the cases that a performance given to members of the public is a performance in public, unless it is shown to be domestic or quasi-domestic in character.  In considering whether it is or is not of a domestic of quasi-domestic nature the relation of the audience to the owner of the copyright is of prime importance.  It seems to me to be impossible to say in the present case that this was a domestic or quasi-domestic performance.  The audience was
composed of members of the public with no domestic ties of any sort.  It consisted in part of persons who had joined the club and paid an annual subscription in order to enjoy the amenities provided by the club and in part of non-members invited to be present as guests at a function promoted by the club, an integral part of which was the performance of dance music.  In relation to the owner of the copyright it was the type of audience which, to use the words of Greene L.J. in Jennings' Case [1936] 1 Ch. 469, 'may properly be described as the owner's public'.  After all, the aim of the Copyright Act is to protect authors and composers from infringement of their copyrights.  It gives to the owner the sole right to perform the work in public.  If the performance in this case were held not to be a performance in public it would make that protection a mockery.  It would mean that every club in the country would be entitled to promote concerts for its members and their guests and, with impunity, to present dramatic and musical productions for their entertainment without obtaining the consent of the owners of the copyright therein.  To give the Act such an interpretation would deprive copyright owners of the very protection which, in my view, it was intended to confer."

     To the same effect is the judgment of the Lord Justice-Clerk in Performing Right Society Ltd v Rangers FC Supporters' Club, Greenock [1975] RPC 626 where it is said (at 634):

     "The antithesis of performing in public is performing in private.  Why should performance in private be excluded?  It is perhaps just as difficult to define 'private' in this context as it is to define 'public'.  But if the purpose of the Act is to preserve the copyright owner's right of property in his work against infringement and prevent unauthorized third parties from using his work to his financial disadvantage, the position becomes clearer.  One then has to look at what has been described as the character of the audience and see whether a performance before such an audience violates these rights.... At one end of the spectrum there is what has been described as the domestic situation.  At the other end is the situation where the promoter invites the public to attend the performance on payment of an entrance fee.  In between there is a wide range of varying situations. Domestic has been extended to include semi-domestic.
What is the underlying reasoning behind the exclusion of domestic or quasi-domestic performances?  It is to be found in the relationship between the audience and the owner of the copyright.  In a situation where a person organises a private party in his own home, or in what might reasonably be deemed an extension of his own home, then it seems reasonable to assume that the unauthorised publication or use of the copyright work is not rebounding to the financial disadvantage of the owner of the copyright, since the selected audience is not enjoying the work under conditions in which they would normally pay for the privilege in one form or another.  A performance of the work in such circumstances would ordinarily be regarded as being in private."

     After referring to this passage, Rath J (in Rank Film Productions) said (at 560):

     "Whilst it is useful thus to consider the contrast between a performance in public and one in private, it would be wrong to convert the test in the Act from the question, Is the performance in public? to the question, Is the performance in private?  It is not merely that the notion of 'in private' is as difficult as the notion of 'in public'; more important is the impropriety of the implicit change in the relevant language.  The answers to the two questions do not necessarily lead to the same conclusions.  The statutory right to perform in public may cover situations that might be thought to be performances in private.  The only proper approach is to look for criteria of public performance.  It is necessary to look broadly at the facts, as indicated by Lord Hanworth MR in Harms (Incorporated) Ltd v Martans Club Ltd.  Of particular importance is the consideration of the character of the audience, as indicated by Lord Greene in the cases I have referred to, and this consideration, when it is made in all the circumstances of the case, will probably be decisive.

     Thus in the present case the court is to consider the character of the audience, and ask whether that audience may fairly be regarded as part of the monopoly of the owner of the copyright.  The relevant character of the audience is not its character of an individual or individuals in a private or domestic situation, but in its character
as a guest or guests of the motel.  In that latter character the guest pays for his accommodation, and the benefits (in-house movies) that go with it.  In a real sense he is paying the proprietor of the motel for presentation to him in the privacy of his room of an in-house movie.  He is in this character a member of the copyright owner's public.

     The words 'in public' in s 86(b) must be construed in the context of the history of the copyright legislation and the case law (a summary of which is to be found in the judgment of Lord Wright in Jennings v Stephens [1936] Ch 469, esp at 475).  Performance 'in public' means performance to the public of the owner of the copyright, and 'public' includes a portion of the public, however small."

     In Australasian Performing Right Association Ltd v Commonwealth Bank of Australia (1992) 40 FCR 59 Gummow J said (at 74):

     "The phrase in s 31(1)(a)(iii) of the [Copyright Act] is 'to perform the work in public' not before 'members of the public' or 'a public audience' or 'the general public'.  Running through the authorities I have discussed is the notion that for the purposes of this performing right a performance will be 'in public' if it is not 'in private', and the perception of an antithesis between performances which are in public and those which are 'domestic' or 'private' in character.  In determining whether a performance answers the latter description, the nature of the audience is important.  In coming together to form the audience for the performance were the persons concerned bound together by a domestic or private tie or by an aspect of their public life?  Their 'public life' would include their presence at their place of employment for the supply of a performance to assist the commercial purposes of their employer."

     In the course of his judgment in the present case Gummow J explained (at 139-140) the way in which the mobile telephone network operates.  He said that each mobile telephone has a radio transmitter and a radio receiver.  The mobile telephone uses these to communicate with a nearby base station which connects these radio transmissions to the rest of the telephone network.  The sections of Australia that are served by the mobile telephone network are divided into a number of cells.  As a telephone moves from one cell to another, the mobile network locks the telephone on to a new base station.  When a person dials someone using a mobile telephone, the person enters the telephone number of the person he is attempting to call and presses the send button.  The mobile telephone communicates with the base station on to which it is locked.  The base station sends the request to the nearest mobile telephone exchange.  Once the request has been accepted by the exchange, the exchange will tell the mobile telephone which radio frequencies to use.  The telephone will be allocated one frequency for transmission and another frequency for reception.  The mobile telephone switches to those frequencies and commences the call.  The radio signals from the mobile telephone are picked up by the base station which sends an electric current through the telephone network to the receiver.  The communications from the person at the other end likewise proceed back through the telephone network to the base station which converts the electric current to radio signals at the allocated frequency which are picked up by the mobile telephone operating at that frequency.

     Because the number of mobile telephones in use at a particular time outnumbers the number of available frequencies, the same frequencies may be allocated to more than one telephone operating in Australia at the same time.  However, this does not happen within one cell or within two adjacent cells.  By ensuring that each mobile telephone within a given area uses different frequencies, Telecom attempts to protect the privacy of the call and prevent the telephone receiving any interference from any other call.  If a number of people were to use their mobile telephones to call one company and they were all placed on hold and played music, the music on hold would either be transmitted to those people from different base stations, or, if they were in the one area, by one base station using different frequencies.

     After referring to a number of authorities including Rank, Mellor and the Commonwealth Bank case, his Honour said (at 144) that the phrase used in relation to broadcasting was "to the public" which "may" involve a more restrictive meaning than the phrase "in public".  His Honour added that the words "the public" commonly meant "the community as an aggregate" and that likewise "to the public" would normally involve some form of general distribution.  As mentioned earlier, I respectfully take the view that, in the relevant context, there is no distinction of substance between the phrases "in public" and "to the public".  That "public" in this context was intended to mean the copyright owner's public is, as I have said, plainly indicated by what was said by the Attorney-General in the course of his second reading speech when introducing the Statute Law (Miscellaneous Provisions) Act (No. 2) 1986.

     The essential reason given by his Honour for concluding that there was no infringement of the broadcast right in the present case is in the following passage from his judgment (at 144):

     "In any case, what is relevant is not just the number of recipients of the transmission, but its essential nature.  As has been pointed out, transmissions to mobile telephones are provided by Telecom to facilitate private communication between two people.  It would be distorting the language of the broadcasting provisions to hold that if during the course of this private communication one party was to communicate a work to the other party, this amounts to a broadcast by Telecom to the public."

     Despite the definition defining "broadcast" to mean a transmission by wireless telegraphy to the public, it is most difficult, in my respectful opinion, to conclude that in some way there was intended to be no infringement of the right unless there was a broadcast to members of the public in some collective sense.  Most people listening to the radio will do so in the privacy of their homes or motor cars.  They will listen to music played over the radio in much the same way as they would do if they were listening to a compact disc or tape being played to them.  They are not listening in groups and there is an element, if not quite to the same extent, of privacy, in the selection of the radio program one chooses to listen to.  Applying the tests propounded in the various cases to which I have referred and taking into account the conclusion reached by Rath J in the Rank case with which I respectfully agree, I am unable to perceive how the playing of music on hold in the circumstances in which it is played over mobile telephones is not an act which falls within the exclusive right provided for in subpara. 31(1)(a)(iv) of the Act.  Music on hold is provided by innumerable organisations to telephone callers who cannot be immediately attended to.  Usually, if not always, the service is provided in circumstances where the call is made for business purposes using that expression in a wide sense.  The call may be to a government department, an airline, a bank, an insurance company and so on.  Often the caller will not be in business but that that does not change the essentially business nature of the call.

     If it be right to say, as I have concluded it is, that it is the copyright owner's public which has to be considered, the provision of music on hold could not be described as "domestic or quasi-domestic in character"; Ferguson J in Canterbury-Bankstown League Club.  Furthermore, the audience, although in some cases reluctant and unwilling, is one "which the owner of the copyright [can] fairly consider a part of his public"; Goddard LJ in Ernest Turner.  These and other expressions used in the various dicta which I have quoted indicate that the use of the copyright work here is a use which the copyright owner may reasonably regard as his or hers to control.  The provision of the music by the organisation called will invariably be for business purposes.  The music may have only a tangential relevance to the essential purpose of the call, but it is provided, no doubt on the basis of marketing experience, to entertain - some might say, appease - the caller during the period he or she has to wait for attention.

     Earlier I have endeavoured to make clear why I think the privacy of a telephone call is not the determining factor.  It is the nature of the use of the copyright material which concludes the matter.  It follows that the playing of music on hold over a mobile telephone constitutes an infringement of the broadcast right.

     In the result, I would allow the appeal in so far as the broadcast right is concerned but dismiss the appeal in so far as the case concerns the diffusion right.

     I certify that this and the forty-three (43) preceding pages are a true copy of the reasons for judgment herein of the Court.

     Associate

     Dated:  23 August 1995

IN THE FEDERAL COURT OF AUSTRALIA)

                                  )

NEW SOUTH WALES DISTRICT REGISTRY)    NG 951 of 1993

                                  )

GENERAL DIVISION                  )

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

           BETWEEN:     AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED

                             Appellant

               AND:     TELSTRA CORPORATION LIMITED

                             Respondent

CORAM: Black C.J, Sheppard and Burchett JJ.

PLACE OF HEARING: Sydney

DATE :  23 August 1995

                    REASONS FOR JUDGMENT

BURCHETT J.:

     This appeal concerns the consequences, under copyright law in Australia, of the playing of music "on hold", while someone who has made a telephone call is being kept waiting on the line.  A test case was brought by the Australasian Performing Right Association Limited (the appellant) seeking (inter alia) declarations that Telstra Corporation Limited, the corporation referred to in the Telstra Corporation Act 1991, which trades as Telecom, infringes the appellant's copyright in certain works used to provide music on hold.

     A variety of situations is involved.  Music on hold may be played to a person who has made a telephone call to a Telecom service centre or office, or to a customer of Telecom who has installed appropriate equipment for the playing of music on hold, or to a customer who is connected to a call handling service provided by Telecom known as "CustomNet", if the particular CustomNet system includes music on hold.  The call may be made utilizing the mobile telephone network, a situation raising peculiar considerations of its own.  Recorded music may be played, or alternatively broadcast music received by a radio set may be the source of the music heard over the telephone.

     Whether the equipment through which the music on hold is received by the telephone system is Telecom's own equipment or belongs to a customer who has installed it, the capacity to carry this music to a caller is a characteristic of the network made available to its customers by Telecom.  It is capable of having equipment appropriate for this purpose connected to it.  Some such equipment is sold by Telecom itself, which advertises the advantages of it, while equipment of the same kind is also available from other suppliers.  Only equipment covered by a permit may be utilized: Telecommunications Act 1991, sections 253 et seq., which should be read with the definition of "customer equipment" in s. 5.  But, on the other hand, equipment that is covered by a permit may be connected to the telephone service, which thus
provides, as part of the service, the facility to play music on hold by the use of such equipment, and also provides the reception of music on hold over the system from all customers of Telecom who have installed such equipment, as well as from Telecom itself, either on its own behalf or on behalf of those customers who utilize a CustomNet system including music on hold.

     The rights, which, in the proceeding below, were claimed to have been infringed, arise out of s. 31(1)(a) of the Copyright Act 1968, as follows:

    "(1)  For the purposes of this Act, unless the contrary intention appears, copyright, in relation to a work, is the exclusive right:

     (a)  in the case of a literary, dramatic or musical work, to do all or any of the following acts:

                            . . .

          (iii)     to perform the work in public;

          (iv)      to broadcast the work;

          (v)       to cause the work to be transmitted to subscribers to a diffusion service;

                          . . .  ."

However, subpara. (iii) is no longer relied on.  The word "broadcast" used in subpara. (iv) should be read bearing in mind the interpretation section, s. 10, subs. (1) of which defines this word, "unless the contrary intention appears", as meaning "transmit by wireless telegraphy to the public".  Subparagraph (v) is the subject of a detailed elucidation in s. 26, which must be set out in full, as follows:

    "26.(1)   A reference in this Act to the transmission of a work or other subject-matter to subscribers to a diffusion service shall be read as a reference to the transmission of the work or other subject-matter in the course of a service of distributing broadcast or other matter (whether provided by the person operating the service or by other persons) over wires, or over other paths provided by a material substance, to the premises of subscribers to the service.

     (2)  For the purposes of this Act, where a work or other subject-matter is so transmitted:

     (a)  the person operating the service shall be deemed to be the person causing the work or other subject-matter to be so transmitted; and

     (b)  no person other than the person operating the service shall be deemed to be causing the work or other subject-matter to be so transmitted, whether or not he provides any facilities for the transmission.

     (3)  For the purposes of the application of this section, a service of distributing broadcast or other matter shall be disregarded where the service is only incidental to a business of keeping or letting premises at which persons reside or sleep, and is operated as part of the amenities provided exclusively for residents or inmates of the premises or for those residents or inmates and their guests.

     (4)  A reference in this section to the person operating a service of distributing broadcast or other matter shall be read as a reference to the person who, in the agreements with subscribers to the service, undertakes to provide them with the service, whether he is the person who transmits the broadcast or other matter or not.

     (5)  Where a service of distributing matter over wires or over other paths provided by a material substance is only incidental to, or part of, a service of transmitting telegraphic or telephonic communications, a subscriber to the last-mentioned service shall be taken, for the purposes of this section, to be a subscriber to the first-mentioned service."

     There is no doubt that Telecom, in the case of a copyright work played as music on hold during a call to one of
Telecom's own offices or services or to premises connected to a CustomNet system, does "cause the work to be transmitted" within any fair meaning of those words in subpara. (v).  I think the same can also be said of cases where the equipment utilized to play the music on hold is not Telecom's, but a customer's.  If the part played by the customer who has arranged for music on hold to be played when his number is called, and there is some ensuing delay, were to be thought a possible difficulty, subs. (2)(a) would answer it completely.  I am leaving to one side calls made over the mobile telephone network.  But the first difficulty in the case is to decide whether music played on hold is transmitted "to subscribers to a diffusion service".  A response to this question requires a careful analysis of s. 26. 

     Although their application may involve complications, there are really only three tests required to be satisfied by a transmission of a work, in order that it should fall within the terms of s. 26(1).  It must be a transmission "in the course of a service of distributing broadcast or other matter"; it must be a transmission "over wires, or over other paths provided by a material substance"; and it must be "to the premises of subscribers to the service".

     The second of these tests is clearly met in the circumstances with which the present appeal is concerned, except in the case where, a call having been made from a mobile telephone, the music on hold is not transmitted wholly in the manner required by the subsection, but in the final stage of its transmission by the means still sometimes referred to as "wireless".  In these cases, it was assumed the appellant can only succeed, if at all, by showing that there is a broadcast within the meaning of s. 31(1)(a)(iv).

     The question to be answered in relation to the first test is whether the transmission of music on hold is made "in the course of a service of distributing broadcast or other matter".  The music, whether coming in from a radio receiver or produced from a tape, record or compact disc, is available to all and sundry, the persons who make a call to the particular telephone number and are required to hold the line.  There may be any number of them, depending on the busyness of the particular connection and its capacity to hold calls while earlier calls are being dealt with.  But the "service" for the purposes of s. 26(1) is not the particular telephone service with its finite group of callers on hold; it is a service provided by Telecom to its customers.  That service involves very many persons receiving music on hold through numerous individual telephone connections.  The question is whether such a service is one of distributing broadcast or other matter. 

     It seems to me that music is certainly "matter", as this word is used in the provision.  Is it distributed?  It is played individually through individual telephone connections,
although, of course, with modern technology, a great number of those individual connections may utilize a single material line.  For Telecom, it was argued that the individual reception of a fragment of music by a particular caller who, depending upon the number of simultaneous calls the equipment in a particular case could handle, and upon whether simultaneous calls were in fact made, might be the only person to hear, upon that transmission, that precise piece of music, is not properly to be described as a distribution.  The simple answer to this is s. 26(5) itself; it plainly contemplates that a service of the relevant kind may be "only ... part of" a telephone service.  Inescapably, that must involve that the characteristics of a telephone service do not disqualify it from being a service of the relevant kind.  Nor is there anything in the word "distributing" to require a different view to be taken.  A sum of money may be distributed among the poor, although no single person receives his share of it in an amount equal to that of any other or on the same occasion as any other.  The distributing of presents at a Christmas party, an example given by senior counsel for the appellant, may be quite individual in nature.  The act of distribution, as is shown by the Shorter Oxford English Dictionary 3rd edition (1980) may be one of "dealing out, or bestowing in portions among a number".  Indeed, when, on 18 May 1967, the then Attorney-General, the Honourable Nigel Bowen Q.C., presented to the House of Representatives the Bill which became the Copyright Act 1968, he did not treat the word "distributing"
in s. 26(1) as having narrowed the meaning of "transmitted" in s. 31(1)(a)(v).  He called (see Hansard (1967) vol. 55 (House of Representatives) p. 2329) the relevant exclusive right in s. 31 "communication of the works to subscribers to a diffusion service, that is, a service in which transmission is effected by land line and not by broadcasting".  It seems to me that, in the present case, the equipment which plays a shorter or longer portion of a piece of music to each caller during the period of his waiting, and may very well be playing virtually the same piece of music to quite a number of callers (and if not the same fragment, at least parts of the same composition), may fairly be regarded as distributing music among the callers.  A fortiori, if one steps back and looks at the whole range of dissemination over Telecom's wires of different pieces of music on hold to different customers holding the line on different calls, the service which provides this amiable amenity for the impatient callers who have been connected to various numbers, may be seen to operate as a service of distributing music.

     The source of the music, whether a radio set, or record, tape or compact disc, is not of significance for the application of s. 26.

     At first sight, the subsidiary nature of the service involved in the provision of music on hold might be thought to militate against its acceptance as a service falling within
s. 26(1).  It may perhaps be seen as a minor adjunct of the full range of services provided by Telecom.  But subs. (5) (and see also subs. (3)) makes it quite clear that the services "of distributing matter over wires" which fall within s. 26(1) include a service that "is only incidental to, or part of, a service of transmitting telegraphic or telephonic communications".  Accordingly, the service, being incidental to or part of the telephone service - making that service, in the current jargon, more user friendly for those subscribers who are compelled to exercise patience while holding the line - is a service within the section notwithstanding that it might not be capable of being seen as such if it stood alone.

     Another argument was raised.  It was said that music on hold is a service provided to the person (whether Telecom or a customer) to whom the telephone number appertains which is called at a time when the call cannot be immediately dealt with.  But s. 26, so the argument ran, is concerned with the provision of a service to the persons who receive the distributed "broadcast or other matter".  I do not think the section involves this sharp dichotomy.  Subsection (1) does not even require the distribution to be to subscribers, but only "to the premises of subscribers to the service".  Subsection (1) expressly contemplates, in the parenthetical statement "whether provided by the person operating the service or by other persons", that there may be persons other than the operator having an interest in the transmission of
the matter to the premises of subscribers.  It is true that the whole subsection is an explication of what is meant by "the transmission of a work ... to subscribers to a diffusion service".  But a transmission of matter provided by other persons is obviously likely, from the point of view of commercial reality, to be for the benefit both of those other persons and of the recipients, each from his own point of view.  The one has a benefit to gain from the matter being transmitted to the others.  Subsection (2) contemplates that, unless the Act made a choice, as it does, to deem the operator of the service to be the person causing the work to be transmitted, the commercial interest of, or the part played by, some other person or persons might require a conclusion that that person or those persons were really causing the work to be transmitted.  Also, subs. (3) is consistent with the view that, except for its express provision, a person who contracts with the proprietor of an hotel to provide a service of distributing music to guests over wires might fall within the terms of the section.  In commercial terms, such a person might receive a substantial reward, while most of the guests might prefer to switch the music off.  Like subs. (5), subs. (3) confirms that the fact that a service may fulfil an extremely subsidiary role in a much bigger operation does not disqualify it from falling within s. 26.  Nor need the service be received exclusively by subscribers, since subs. (3) permits it to be provided also for "their guests".

     It seems to me that if Telecom provides a service, as part of its telephone service, or as a subsidiary feature of its telephone service, of distributing relevant matter to the premises of those subscribers who make calls to Telecom itself or to other persons who have availed themselves of the facility to provide music on hold, that service falls within the language of s. 26.  That a service is incidentally provided to Telecom itself, and to those customers who have arranged for the music on hold to be played, is irrelevant.  The service provided to the latter is to enable them to procure the conferring by Telecom, upon those of its customers who call them, of an amenity (ie. a service) which would certainly not be provided if it were not seen as desirable.  The service falls within s. 26 because it is not just a service to the customer called; it is also a service provided to every subscriber whose telephone is used to make a call with greater satisfaction, and even perhaps pleasure, than would have been possible before Telecom started to provide this service.  The fact that these customers have not separately and specifically sought this particular service when they subscribed is irrelevant; the legislature must have contemplated that situation when it enacted subss. (3) and especially (5).

     Concentrating for a moment specifically on that portion of subs. (5) which is concerned with a service that is "only ... part of" a telephone service, it is difficult to see any
basis for excluding the playing of music on hold from these words.  Inherently important or not, the playing of music must be a service to the listener.  And any communication received by the subscriber to a telephone is part of the telephonic service rendered to him.  It cannot make any difference that the communication is received whilst he is "on hold", having attempted to make a communication by telephone himself, nor that a particular recipient is not very interested in a communication taking the form of music.  A telephone is for the receiving as well as for the sending of communications.

     The third question is whether the words "to the premises of subscribers to the service" are satisfied.  I have already discussed subs. (5), which provides the answer to this question, in the course of dealing with the first question.  By virtue of subs. (5), where a service of distributing matter over wires is only incidental to, or part of, a telephone service, a subscriber to the telephone service "shall be taken, for the purposes of this section, to be a subscriber to the [service of distributing matter over wires]".  Accordingly, the subscribers to whom I have referred as customers of Telecom making calls to numbers provided with the facility to play music on hold are to be taken to be subscribers to the service of distributing matter over wires.

     I have referred to customers of Telecom making calls to numbers provided with the facility to play music on hold.  Of course, some persons who may make such calls may not be customers of Telecom.  They may call from the premises of a subscriber, not being themselves subscribers.  But it is just because any diffusion service (not only one using telephone lines) is likely also to serve such people that s. 26(1) extends the expression "transmission ... to subscribers" to embrace transmission "to the premises of subscribers".  In any case, the mere fact that people other than subscribers may also benefit is quite consistent with the reference to "guests" in s. 26(3).  And s. 26(5) must contemplate the normal way "telephonic communications" work, including the fact that a subscriber's premises will be used by other persons.  Finally, on this point, some people sometimes make calls from public telephones.  If they are not to be seen as subscribers (although they pay to make such a call, there would be difficulty in reading s. 26(1) as covering them), this only means that it is in the nature of a service which is part of a service of transmitting telephonic communications that its public telephones will give additional persons access to the service.  Again, s. 26(5) must contemplate that situation.

     Senior counsel for Telecom sought to make much of the expression "the person who, in the agreements with subscribers to the service, undertakes to provide them with the service" in subs. (4).  He said these agreements could not be identified, since the only agreement was to provide telephonic services.  But subs. (4) cannot be read in isolation.  It must be accommodated to subss. (3) and (5), which plainly contemplate that s. 26 can apply to a service which "is only incidental to" or "part of" a larger service.  In cases of that kind the legislature can hardly have imagined there would be separate agreements covering a mere incident or part of a larger service that had been agreed to be provided.  Telecom's argument would make nonsense of subs. (5).  If a subscriber to one service is required, by the statute, to be "taken, for the purposes of this section, to be" a subscriber to the other, it must also be taken that the agreement to provide him with the one service covers the other.  In any case, in the present circumstances, Telecom's agreement to provide telephonic services does include the reception of music on hold in all those cases where music on hold is played, just as it includes the reception of the voice of the operator at the other end of the line when the caller's turn comes to be dealt with.

     The learned trial judge, in rejecting the appellant's application, was much influenced by the proposition that the only service provided to anyone is the facility to play music on hold provided to a customer of Telecom who arranges for it to be played.  But if that customer did not see the playing of the music as a desirable amenity for the caller unavoidably kept waiting, he would not wish to have it provided.  He does not listen to the music himself.  The same is true of Telecom, in those cases where it arranges for a caller to it to receive music on hold.  With respect, the proposition is like saying that a motor vehicle repairer who arranges free transport to the nearest railway station, or an hotel owner who arranges free transport from an airport, is not providing a service to clients, simply because the purpose is to benefit his own business to which the service is an adjunct.  Of course, in the present case, it would not avail Telecom, once the provision of a service to the caller is accepted, to say that the service is not provided by it, but by the customer called.  This is because, not only would the case of music on hold played when Telecom itself is called be left unanswered, but also because subs. (2) makes Telecom responsible, as "the person operating the service", whatever the actual role of any other person, such as the customer called. 

     A separate issue arises in those cases where the source of the music on hold is a radio broadcast appropriately received so as to be heard through the music on hold system by waiting callers who have called a particular number or bracket of numbers.  In such cases, it is necessary to take account of the terms of s. 199(4) of the Copyright Act:

    "(4)  A person who, by the reception of an authorized television broadcast or sound broadcast, causes a literary, dramatic or musical work or an adaptation of such a work, an artistic work or a cinematograph film to be transmitted to subscribers to a diffusion service shall be treated, in any proceedings for infringement of the copyright, if any, in the work or film, as if he had been the holder of a licence granted by the owner of that copyright to cause the work, adaptation or film to be transmitted by him to subscribers to that service by the reception of the broadcast."

     The first thing to note about s. 199(4) is that it is concerned with transmission to subscribers to a diffusion
service.  It is not concerned with broadcasting.  The next thing to note is that s. 26, the terms of which it has been necessary so far to consider for the purposes of the application of s. 31, is also relevant to the meaning of s. 199(4).  For s. 26 provides the basis on which the concept of transmission of a work or other subject matter to subscribers to a diffusion service must be understood, not only for the purposes of s. 31, but also for the purposes of the Act as a whole.  The third thing to note is that the expression "by the reception of a ... sound broadcast" has been elaborated in s. 25(2) of the Act, as follows:

    "(2)  A reference in this Act to the doing of an act by the reception of a television broadcast or sound broadcast shall be read as a reference to the doing of that act by means of receiving a broadcast:

     (a)  from the transmission by which the broadcast is made; or

     (b)  from a transmission made otherwise than by way of broadcasting, but simultaneously with the transmission referred to in the last preceding paragraph;

     whether the reception of the broadcast is directly from the transmission concerned or from a re-transmission made by any person from any place."

This provision expands slightly the bare words "by the reception of" so that they refer to "the doing of [an] act by means of receiving a broadcast", and also expands the scope of what may, for relevant purposes, amount to a broadcast, so that it includes (inter alia) "a re-transmission made by any person from any place".

     The concept of causing a work to be transmitted by means of receiving it is certainly an oddity which, if only it had point, could be called an oxymoron.  But in s. 199(4) it does not stand alone.  The transmission contemplated is "to subscribers to a diffusion service".  Once the implications of this are appreciated, it becomes clear that the author of the expression is taking for granted the diffusion service itself, as an operating service, and adding to it the mere reception of a broadcast, which is then picked up by it and transmitted to the subscribers to the service (cf. the operation involved in Performing Right Society Ltd v. Marlin Communal Aerials Ltd [1977] F.S.R. 51).  If, as I think it should be, s. 199(4) is understood as referring to a situation of that kind, it reflects, perhaps not quite perfectly, a policy that royalties paid for so wide a dissemination as an authorized broadcast may in general represent should be considered to cover also any extension of that broadcast to the subscribers to a diffusion service - the policy, in fact, explained in paras. 438 and 445-447 of the Report of the Committee to consider the Law on Copyright and Designs, of which Whitford J. was Chairman, presented to the United Kingdom Parliament in March 1977.  See too the Australian Report of the Copyright Law Review Committee, 1959 (the Spicer Committee) paras. 412-413.  On this basis, the provision covers the situation in question in the appeal, so far as music on hold emanating from radio broadcasts is concerned.

     In their written submissions in reply, counsel for the appellant said their point was that, where a customer of Telecom used a radio receiving set to transmit broadcast music into and through the telephone network, Telecom did not receive the broadcast.  But this is to overlook the final words of s. 25(2).  It is sufficient that the customer's equipment effected "a re-transmission" which was received by Telecom's own equipment.  The re-transmission need not be a re-broadcast, as is made clear by the expression "transmission made otherwise than by way of broadcasting" in s. 25(2)(b). 

     The final question in the appeal relates to the reception of music on hold by users of mobile telephones.  The learned trial judge found that mobile telephones have a radio transmitter and a radio receiver by which communication is effected with a nearby base station.  Through the base station, radio transmissions to and from a mobile telephone are connected to the rest of the telephone network.  The technical details are set out in the judgment under appeal (Australasian Performing Right Association Limited v. Telstra Corporation Limited (1993) 46 FCR 131) at 139 et seq.

     No argument was advanced that the radio transmissions involved in the use of mobile telephones were merely ancillary to the operation which included the dissemination of the music on hold through what, according to the submission I have already accepted, was a diffusion service.  There may be much to be said for the proposition that mobile telephone facilities, as well as outback radio telephone links or satellite links (neither of which was involved in this case), are merely ancillary features of a system falling within s. 26(1) because overwhelmingly it works by "transmission ... over wires, or over other paths provided by a material substance, to the premises of subscribers to the service".  (Cf. Regina v. Effik [1995] 1 AC 309, where a similar view, in respect of the operation of the legislation there in question, was rejected, but only with hesitation and upon the basis of a quite compelling context.)  Neither s. 31(1)(a)(v) nor s. 26(1) requires in terms that a particular transmission, in order to fall within the former provision, must be effected exclusively by wire or other material substance, but only that the transmission be effected "in the course of a service of distributing ... matter ... over wires ... to the premises of subscribers to the service".

     The argument which was put in respect of the transmission of music on hold received by mobile telephones was that a "broadcast" was involved within the meaning of s. 31(1)(a)(iv).  To broadcast a work within the meaning of that provision is, by virtue of the definition of "broadcast" in s. 10, to "transmit by wireless telegraphy to the public", "wireless telegraphy" being itself defined in the same section as meaning "the emitting or receiving, otherwise than over a path that is provided by a material substance, of electromagnetic energy". 

     To the appellant's case under s. 31(1)(a)(iv) only one answer was opposed, but that proved, in the opinion of the learned trial judge, to be fatal.  It was that the transmission involved in the use of a mobile telephone is not a transmission "to the public".  Indeed, it was pointed out that the communications for which mobile telephones are designed are, in their nature, confidential communications between two people.  Of course, this leaves out of account the use of a mobile telephone to communicate with the users of a normal telephone in conference mode.  More importantly, it leaves out of account the fact that music on hold is only played when the intended confidential communication between two people is not able to take place, and until it occurs.

     The real point is that the music on hold, when a mobile telephone is being used, is being transmitted individually to a particular mobile telephone receiving on a particular frequency.  However, the same base station may, of course, at the same time be engaged in transmitting the same music on hold to other mobile telephones on other frequencies, and other base stations may be similarly engaged.  But, if so, the number of recipients will still be limited.  Is a transmission, which is intended to be to all callers required to hold a particular line or a line being one of a particular group of lines, a transmission to the public, notwithstanding that only one caller may in fact be listening? 

     The words "to the public" did not originally appear in the definition of "broadcast" in the Copyright Act.  They were inserted by the Statute Law (Miscellaneous Provisions) Act (No. 2) 1986.  In his second reading speech, the Attorney-General said:

    "The amendment will clarify the definition of `broadcast', which was modified by the Copyright Amendment Act 1986 ... .  Interested groups have submitted that the wording inserted by that Act is ambiguous, and does not express the Government's intention that `broadcast', in this context, should cover transmissions to the copyright owner's public, whether the `general' public or part of the public.  Following consultations there is agreement with the policy and wording of the proposed new definition."

The appellant's contention is that the persons to whom music on hold is played are part of "the copyright owner's public".

     Some emphasis was laid, for Telecom, on an aspect of the use of mobile telephones which the learned trial Judge summarized as follows (at 140):

    "If a number of people were to use their mobile telephones to call one company and they were all placed on hold and played music, ... the music on hold will either be transmitted to these people from different base stations, or, if they are in the one area, by one base station using different frequencies."

Telecom's reliance on this finding involved the assumption that a recording played as music on hold, in these circumstances, could not be regarded as transmitted to all the callers, because each would be receiving a separate
transmission.  Indeed it was emphasized that each transmission is part of a confidential communication the privacy of which is protected by law, although, of course, there is nothing private about the playing of music on hold.  On this footing, the learned trial Judge (at 141) stated the problem as being "whether one mobile telephone listener can properly be described as receiving transmissions `to the public'."  But the definition of "broadcast" in s. 10 does not use the noun "transmission", and even if it did there would be a question whether, by the Acts Interpretation Act, the singular would include the plural.  The definition in fact is expressed as a statement that "`broadcast' means transmit by wireless telegraphy to the public".  When a particular tape is played as music on hold and is transmitted to several callers in the way postulated by his Honour, it is transmitted by wireless telegraphy to a number of persons who have selected themselves from the general public by telephoning a busy number, or one of a bracket of busy numbers, during a particular time period (that is, between the time the first of them called the number, or one of the numbers, and the time he was able to be attended to).  The facts that each transmission was at a different frequency, and that different base stations may have been involved, cannot alter the complete appropriateness to the situation of the statement that Telecom transmitted the music on hold to those persons by wireless telegraphy.  Its doing so, in the example, would have been part of a continuous process of transmitting the music on hold to a succession of
callers, hour by hour and day by day.  The question is whether, in doing so, it transmitted to the public.

     Arguments based on the individuality of each call seem to me, at bottom, to rest on a confusion of language arising out of the connotations of the word "broadcast" itself.  It is a confusion because that word does not have in the Copyright Act its normal meaning.  Subject only to the appearance of a contrary intention (which was not suggested), it is defined in the way I have stated, and the defined meaning is that which must be applied.  This is particularly so since the legislative history (which the trial Judge summarized at 141-142) shows that a definition retaining the use of the word "broadcast" was deliberately omitted, and the present definition deliberately inserted.  I think it is clear Parliament intended that the word should not be limited to those transmissions by wireless telegraphy which involve the widespread dissemination normally implicit in the notion of broadcasting.

     If, however, the language of the statute should be regarded as ambiguous, the second reading speech of the Attorney-General in relation to the amendment effected by the Statute Law (Miscellaneous Provisions) Act (No. 2) 1986, which is quoted by the learned trial Judge at 141, makes clear "the Government's intention that `broadcast', in this context, should cover transmissions to the copyright owner's public, whether the `general' public or part of the public."

     The expression "the copyright owner's public" has an accepted place in this area of the law.  It is an important element in the rationale of a series of cases which has given a very extensive reach to the concept of public performance in the law of copyright.  Many of those cases were conveniently collected by Gummow J. in Australasian Performing Right Association Limited v. Commonwealth Bank of Australia (1992) 40 FCR 59, where his Honour concluded (at 74) that "if a performance occurs as an adjunct to a commercial activity the performance is likely to be regarded as public".

     In Jennings v. Stephens [1936] 1 Ch. 469 at 486, Greene L.J. (as he then was) said that it was "particularly important to bear in mind the position of the owner of the copyright in relation to the audience."  He treated as crucial whether the relevant performance "would have been a performance before an audience which, in relation to the owner and in respect of that performance, formed part of his `public'".  In Ernest Turner Electrical Instruments, Limited v. Performing Right Society, Limited [1943] 1 Ch. 167 at 172-174, Lord Greene M.R. returned to this point, suggesting that "the primary matter to consider [is] the relationship of the audience to the owner of the copyright rather than the relationship of the audience to the performers."  He said, of the Act there in question:

    "The monopoly is confined to performances in public, and, in considering whether a performance is in public, its effect on the value to the copyright owner of his statutory monopoly is, I venture to think, a consideration of great importance."

In the same case Goddard L.J. (at 175-176) referred to the criterion of "the character of the audience", and posed the question: "Is the audience one which the owner of the copyright could fairly consider a part of his public?"

     The two Court of Appeal decisions to which I have referred were carefully discussed by Ferguson J. (with whom Herron C.J. agreed, while Asprey J., in a separate judgment, reached similar conclusions) in Australasian Performing Right Association Limited v. Canterbury-Bankstown League Club Limited (1964-5) NSWR 138, where he said (at 143):

    "It seems to me to be conclusively established by the cases that a performance given to members of the public is a performance in public, unless it is shown to be domestic or quasi-domestic in character.  In considering whether it is or is not of a domestic or quasi-domestic nature the relation of the audience to the owner of the copyright is of prime importance."

He applied this statement to a performance before the members of a club and their guests, saying (ubi supra):

    "In relation to the owner of the copyright it was the type of audience which ... `may properly be described as the owner's public'.  After all, the aim of the Copyright Act 1912 ... is to protect authors and composers from infringement of their copyrights.  It gives to the owner the sole right to perform the work in public."

These passages were adopted unqualifiedly, as echoing his own approach, by the Lord Justice-Clerk, Lord Wheatley (with whom Lord Milligan and Lord Fraser expressed agreement) in The Performing Right Society Limited v. Rangers F.C. Supporters Club [1975] RPC 626 at 636. 

     The same cases were also considered by Rath J. in Rank Film Production Ltd v. Colin S. Dodds (trading as Town and Country Motel) (1983) 2 NSWLR 553, which was concerned with the exhibition of films in motel rooms.  Rath J. noted (at 558) that "although only one or two persons saw the films, they did so as guests of the motel, that is to say, as members of a section of the public.  And though the performance was in private, it was arranged as part of a commercial transaction."  His Honour said (at 560) that it was "necessary to look broadly at the facts", and that "(o)f particular importance [was] the consideration of the character of the audience", which, "when it is made in all the circumstances of the case, will probably be decisive."  He continued:

    "Thus in the present case the court is to consider the character of the audience, and ask whether that audience may fairly be regarded as part of the monopoly of the owner of the copyright.  The relevant character of the audience is not its character of an individual or individuals in a private or domestic situation, but in its character as a guest or guests of the motel.  In that latter character the guest pays for his accommodation, and the benefits (in-house movies) that go with it.  In a real sense he is paying the proprietor of the motel for presentation to him in the privacy of his room of an in-house movie.  He is in this character a member of the copyright owner's public. 

     The words `in public' in s 86(b) [of the Copyright Act 1968] must be construed in the context of the history of the copyright legislation and the case law ... .  Performance `in public' means performance to the public of the owner of the copyright, and `public' includes a portion of the public, however small."

     Although the expression under consideration in the cases to which I have been referring was "in public", the fundamental propositions enunciated in those cases do not depend, to any degree, upon the preposition "in"; on the contrary, they are asserted in spite of it.  And in the final quotation which I have made from the judgment of Rath J. (as in the former of the two passages I quoted from the Full Court judgment of Ferguson J.), it will be observed that performance in public is equated with performance to the public of the owner of the copyright.  Consequently, I am unable to accept the submission of counsel for the respondent that these cases are not relevant to the present problem.  Furthermore, insofar as they explain what is meant by a reference to the copyright owner's public, they are not only relevant, but essential, to an understanding of the second reading speech quoted earlier in these reasons.

     But the principal basis on which it was denied, in the present case, that there was a transmission "to the public" rested on the proposition that the numbers of persons hearing a particular piece of music on hold via mobile telephones would necessarily be small, and might often be limited to one person.  It seems to me that this argument cannot stand if the decision of Rath J. in Rank Film Production was correct.  As in that case, the setting is not a domestic or private one, but commercial.  If Rath J. was correct in thinking that a
portion of the public, "however small", would suffice, to enable it to be said that there was a performance to the public, the same proposition must apply to a transmission of the music in question in the present case to a portion of the public.  Was Rath J. correct?

     In my opinion, the conclusion of Rath J. is supported by the cases.  It is convenient to start with Jennings v. Stephens (supra at 476), where Lord Wright M.R. said:

    "Such authorities as there are do not seem very precise in defining the meaning of the words `in public'; it is certainly difficult and perhaps impossible to define the precise borders of the territory which they cover.  `The public' is a term of uncertain import; it must be limited in every case by the context in which it is used.  It does not generally mean the inhabitants of the world or even the inhabitants of this country.  In any specific context it may mean for practical purposes only the inhabitants of a village or such members of the community as particular advertisements would reach, or who would be interested in any particular matter, professional, political, social, artistic, or local.  In the case of a dramatic work the public may be regarded as including persons to whom the drama appeals, but that again must be limited by local and other conditions.  Thus it is clear that by `public' is meant in the words of Bowen L.J. `a portion of the public.'  The particular portion of the public which is meant may sometimes be very small indeed.  ...  Thus mere numbers cannot be the test."

This passage was referred to in The Performing Right Society Ltd v. Rangers F.C. Supporters Club (supra, at 637), and it was pointed out that the relevant portion of the public "can be a very limited section of the public".  In a different context, in Charter v. Race Relations Board [1973] AC 868 at 885, Lord Reid said of the expression "the public or a section of the public":

    "Read literally the words denote any two or more persons associated together in any way - perhaps any one person could be a section of the public but I shall assume not."

Later in the same speech (at 887) his Lordship referred to the copyright cases, saying:

    "(T)here are obvious reasons for reading the words `in public' in such a way as to give all reasonable protection to an author's rights."

     Chappell & Co Ltd v. Associated Radio Co of Australia Ltd [1925] VLR 350 is an interesting case.  As will be apparent from its date, at the time the facts arose radio broadcasting was in its infancy.  The question before the Full Court of the Supreme Court of Victoria, as appears from the judgment of the Court delivered by Cussen J. (at 359), was whether, in the case of a radio broadcast, there was a performance of musical works in public.  Cussen J. (at 359-360) referred to a contention "that at each listener's station there was a private representation only".  This contention was rejected on the broad ground that "(t)he defendant is in the position of a person who, knowing that there are various trains or leads to various hearers, sets them all in pulsation practically at the same instant."  The individual reception of the radio signals did not, in the Court's view, prevent there being a performance in public.

     If what W.R. Cornish in his Intellectual Property: Patents, Copyright, Trade Marks and Allied Rights, 2nd edition (1989) at 300, called "the primacy of the owner's entitlement to an economic return from his proprietary rights" is, as the cases suggest, to be a guide in the interpretation of the Copyright Act, it seems to me that a transmission may be "to the public" if it is intended for a section of the public, although at any given time it may in fact be beamed to only one or two persons.  The music on hold is intended for any member of the public who makes a call to the relevant telephone number, or to one of a group of relevant telephone numbers, which is placed on hold.  The callers are undoubtedly a section of the public, being selected only by the fact that they have chosen to make the relevant calls, and the cases show, as Browne-Wilkinson J. (as he then was) said in Performing Right Society Ltd v. Harlequin Record Shops Ltd (1979) 1 WLR 851 at 857, "the character of the audience is the decisive factor".  The number of the audience is not the decisive factor.  This may readily be appreciated if consideration be given to the situation at the end of the "run" of a film in a suburban film theatre.  The final showing may be seen by only one person, but in such a case it could not be said that the showing of the film was on that last occasion any less a showing to the public than the showing on the first occasion to an audience of, perhaps, three hundred.

     In my opinion, music on hold, transmitted to mobile telephones in the circumstances in question in this appeal, is
transmitted to the public, and accordingly is "broadcast" within the meaning of s. 31(1)(a)(iv) of the Act.

     It follows that the appeal should be allowed, except in respect of the playing of music on hold sourced in a radio broadcast.

     I agree in the orders proposed by the Chief Justice.

     I certify that this and the preceding thirty (30) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Burchett.

     Associate:

     Date:  23 August 1995

     Counsel for the Appellant:        Mr D.K. Catterns Q.C. with Mr R. Cobden

     Solicitors for the Appellant:         Faulkner & Associates

     Counsel for the Respondent:       Dr J. Emmerson Q.C. with Mr D.M. Yates

     Solicitors for the Respondent:    Holding Redlich

     Dates of hearing:                 17 and 18 May 1994