The early culture of the Internet, a culture that remains embedded in many users today, stressed that the Internet is a forum for the free exchange of information, unhindered by the traditional legal and practical impediments inherent in the non-digital world.
The practice resulting from this premise has resulted in the development of cyberspace as a place for the digitisation, reproduction and rapid dissemination of copyright work. This has raised a number of challenges for law enforcement, which “understood in the broadest sense to encompass both public and private law is unusually problematic in the special environment of cyberspace. Not only can it be difficult to locate an anonymous or pseudonymous Internet user within any specific territorial jurisdiction but the global nature of the Internet decreases the likelihood that the parties to online disputes will be subject to control by the same territorial law enforcement entities.”
Traditional legal copyright regulation aims to strike a balance between the rights of copyright owners who want to control their intellectual property and ensure adequate acknowledgement and remuneration, with users who seek material to aid creativity.
The Internet together with digitising technologies has significantly benefited users through globalising information and exponentially increasing its availability. The same Internet has also complicated user rights by creating disparity in the definition of when, where and how a copyright infringement may occur online. This disparity was not contemplated by traditional copyright legislation designed for the offline world, and the result has been widespread confusion and debate about how this situation should be rectified.
Copyright is the process by which creators of work “protect [against the] unauthorised reproduction or adaptation of original creations such as books, computer programs, scripts, paintings, sculptures, drawings, photographs, music, film, video, broadcasts and the choreography of a performance.” Copyright seeks to protect the creation of intellectual property by assigning some reserved rights of the work as it is created and distributed. For example, the copyright owner has the exclusive rights to copy, publish, perform, broadcast, adapt, sell, license or import copyright protected creations. Copyright also aims to ensure financial compensation where reserved rights are infringed. Thus, whilst on the one hand copyright facilitates the free flow of ideas, it enforces attribution and fair use on the other.
Copyright is necessary to encourage the creation of new works by providing some guarantee over protection of that work. Consequently, copyright law must balance the incentives for the production of original works against the social cost arising from conferring exclusive rights over the use of the material. “Copyright protection – the right of the copyright owner to prevent others from making copies – trades off the costs of limiting access to a work against the benefits of providing incentives to create the work in the first place. Striking the correct balance between access and incentives is the central problem in copyright law.”
In Australia, the Copyright Act 1968 (Cth) uses a two-staged test of whether a substantial part of a work has been produced and whether or not a public interest defence (such as fair dealing) applies. The Act distinguishes between protecting original works, and protecting subject matter other than works. ‘Original works’ include those literary, dramatic, musical and artistic works which form a traditional basis of copyright law. ‘Subject matter other than works’ recognises new categories of work such as sound recordings, cinematograph films, television and sound broadcasts, and published editions of works. The underlying principle is that the work is original and has required some skill, labour, judgement or analysis in the creation process.
Moral rights concern the right of the author to be recognised as the creator of the works, and to decide in what manner the work is used or manipulated. As such, those rights ‘related to the author’s creativity and personality’ are not considered further in this paper due to their distinction from the economic right bestowed by copyright law.
Policy considerations provide that it is in the public interest that the use of copyright works should be permitted subject to a ‘public interest defence’, although it has been argued that such defences mainly benefit those special entities e.g. schools that have traditionally been able to actively infringe copyright works, but cannot afford the appropriate licence.
‘Fair use’ is one defence, and permits the use of copyright material for the purposes of research or study, criticism or review, reporting of news and professional advice given by a legal practitioner or patent attorney subject to rules. What may be seen in an online context is that in light of the quality and ease of reproductions using modern technologies, ‘fair use’ provisions are rarely relevant when it is now easier to copy the entire work. Thus, the requirement that a substantial part of any copyright work, must be taken for copyright to be infringed even in the qualitative sense seems, at least in the online context, a redundant proposition.
Where intellectual property cannot be protected by copyright (in whatever form that may take), the creator is significantly discouraged from participating in the creative process.
 Coleman, R. “Copycats on the Superhighway”, 1995, 81 A.B.A. J 68,69
 Borland, J. and William, P.L. “An Economic Analysis of the Division of Copyright Between Newspaper Publishers and Journalists”, (1993) 16(2) UNSWLJ 351
 Landes, W.M. and Posner, R.A. “An Economic Analysis of Copyright Law”, (1989) 18 Journal of Legal Studies 325 at 326
 Krone, T. (Australian Government Institute of Criminology), “Copyright Offences”, 2005, High Tech Crime Brief, March, available at http://www.aic.gov.au accessed 8 April 2006
 Berne Convention for the Protection of Literary and Artistic Works (Paris Text 1971)
 Lim, Y.F. “Cyberspace Law: Commentaries and Materials”, 2002, Oxford University Press, p. 383
 Shaffer Van Houweling, M. “Distributive Values”, (2005) 83(6) Texas Law Review, p. 1564
 Copyright Act 1968 (Cth) ss 40-43, s 103A-C
 AutoDesk v Dyason (1993) 176 CLR 300