MPAA Loses Again

The Supreme Court yesterday declined to hear an appeal from the MPAA, thus letting stand a lower court ruling that Cablevision’s new remote DVR technology does not constitute a “retransmission” of the programming and thus require additional fees.

The new DVR service would work by storing a viewer’s recordings in computers housed at the cable operator, rather than in a box attached to the viewer’s TV set, making it easier and cheaper for cable and phone companies to offer a recording service. The court said Monday it wouldn’t disturb a federal appeals court ruling that the technology doesn’t violate copyright laws.

Cablevision has said it would launch the service as soon as this summer. Spokesmen for other pay-TV companies, including Time Warner Cable Inc. and Verizon Communications Inc., said they are looking into using such a technology but declined to comment on when they might do so.

The decision is likely to accelerate adoption of DVRs in the U.S., potentially eating into ad revenue at TV networks. As a group, people watching recorded shows on DVRs fast-forward past more than half the commercials, according to network and advertising executives. That makes DVR viewers less valuable to networks selling ad time than the viewers who watch shows live.

But DVR viewers also watch more TV, some network executives say, making an argument for a potential upside to broader DVR penetration. The technology was already in 30% of the U.S. households with televisions as of May, according to Nielsen Co.

That last part is certainly right.  With the advent of DVR technology, combined with the ability to watch older shows via Netflix and/or Roku, I spend less time watching television and but see more programming.  Indeed, I’m at the point where I find even fast-forwarding through commercials an annoyance.

I’m not at all enthusiastic about having the cable companies, who are in bed with the TV networks, in control of my programming and can’t imagine switching to that sort of service.  Yes, having a massive on-demand inventory of current shows would be a boon.  But my strong guess is that, in short order, they’ll make it difficult or impossible to skip commercials.

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James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Eric Florack says:

    Well, don’t get too excited, James, about the ‘massive’ storehouse of viewing available on a DVR. As it happens, I have a T/W implenatation of the DVR you’ve pictured. If there’s enough room on the thing for 25 hours of HD, I’d be surprised. Now, granted, I gather there are ways to hang added drives off the thing, but that’s extra money most people won’t bother to invest. The biggest use for such boxes is delayed viewing. Thereby, I should add, destroying the nonsense about added fees being called for for duplicated programming.

  2. James Joyner says:

    My understanding is that this isn’t a “box” but rather massive shared storage at the cable company. If you save, say, the latest “Burn Notice,” they don’t save a separate copy for you and the other 5000 subscribers also saving it but rather just serve it to those subscribers on demand.

  3. Eric Florack says:

    Hmmm.

    Well, the one you have pictured uses a fair sized hard drive for the purpose of storage. As I say, I have one of those beasts.

    That said, TW up here also has programs that they store at their central site they call ‘on demand’. OD does carry a premium price for the producers… even the OD that TW offers for free.

    Now, I can see where that technology wouldn’t need to be changed much to function like a DVR. It would have the advanage of being far less of a maintainance worry, than would having the technology installed in end user’s houses…. on top of the leveaging of storage you mention.

    Now, as I gather it, there was very little challange to the customer domocile equipment, (Whcih stores stuf in a device on the consumer’s property) because the case law surrounding the end user’s right to record and playback was well established with the VCR. (Interestingly, a lot of the principles applied were orignally heard and developed incoidental to RIAA lawsuits regards audio tape.)

    If you’re correct that the technology is at the cable company’s end, but in effect rented by the customer, I grant the technology is different, but I fail to see any difference in legality. The customer is making use of his right to record and playback in his home.

    Every time there’s an advancement in technology these parasites try to extrot more money from the end user. In that sense, they’re not unlike government.

  4. Boyd says:

    Bit, I think James’s choice of an illustrating graphic is confusing the issue a bit. From the linked article, and quoted by James above (emphasis added, of course):

    The new DVR service would work by storing a viewer’s recordings in computers housed at the cable operator, rather than in a box attached to the viewer’s TV set…

    I think a lot of this will revolve around how it’s implemented, or at least how they spin the implementation. I can see how a “‘pre-emptive’ recording by the service provider” and a “specific recording by the ultimate consumer” can be viewed as different beasts, even if the final product is indistinguishable between the two.

  5. Eric Florack says:

    Boyd,

    True.

    That’s why I covered that aspect in my second response.

    It’s striking, though, that we’re dealing more with the technology minutiae than the end-user reality of the situation. (the emph is crucial to the point) Given the end user reality, I don’t see the difference in principle.

    By the way, James…. I forgot one feature TW has been offering which adds a bit of cloud to all of this; “Start Over”. Digital customers have the ability to show up at any time during the program and issue the order to ‘start over’ the program so you won’t miss the thing. this shows several things. first, it tells me they’re ALREADY storing everything. Since you mentioned the commercials… the real source of revenue anyway… one ‘feature’ of “start over” is that you can’t shuttle past the commercials.