The US Supreme Court has decided to open the way for wider use of DVR systems by refusing to hear a case on a digital video recorder technology, which is thus a smack to the television networks.
Back in 2006, Cablevision Systems, the New York-area cable operator, announced a plan called a network DVR system. Using the system, a customer would use a remote control to digitally record a program like “60 Minutes” but instead of storing the show in the customer’s at-home DVR box, the technology would store the show on a faraway Cablevision server.
The technology would let Cablevision convert set-top boxes into boxes with DVR capabilities without requiring an installation or new equipment. It opens up the possibility of offering a DVR experience to all of our digital cable customers. Programmers including Turner Broadcasting System’s Cartoon Network, CNN and television networks sued Cablevision, saying the system violated copyright law.
In March 2007, a lower court agreed and stipulated that Cablevision would be engaging in unauthorized reproductions and transmissions of plaintiffs’ copyrighted programs. The United States Court of Appeals for the Second Circuit in New York reversed that decision in August 2008. The plaintiffs asked the Supreme Court to hear the case, but the Supreme Court’s refusal essentially reinforced the Second Circuit’s decision.
Patrick Ross, the executive director of the Copyright Alliance, an industry group that includes the Motion Picture Association of America and Time Warner, said a recording stored in a network was different from one stored in a consumer’s set-top box.
It seems to be a very clever way for a licensee of creative works to develop new distribution methods that, it would argue, do not require licenses,” Ross said.
Besides the licensing issue, programmers are generally opposed to anything that makes DVRs more pervasive, because consumers using DVRs tend to skip advertisements.
Cablevision said the decision would help make DVRs more accessible. Mr. Rutledge has argued that DVRs are not necessarily bad for advertisers, saying programmers and advertisers could, for example, sign agreements allowing Cablevision to insert new ads into recorded content.
Cablevision halted its introduction of the network DVR in 2006, and plans to introduce a preview of it this summer, when it will allow some customers to pause live shows. It has not announced when it will introduce the full service, or how much it will cost customers.
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