Cable Industry Joins MPAA In Asking FCC To Allow Them To Stop Your DVR From Recording Movies

from the without-any-reason dept

Ars Technica has allowed the cable industry lobbyists' top lawyer to explain why the cable industry supports breaking your DVR in a misguided effort to add more windows to movie releases. Not surprisingly, he simply repeats the MPAA's flat out lies and misrepresentations on this particular issue. For example, he claims that the movie studios need this or they won't get content out to the industry early enough. But that's wrong. There is nothing stopping the movie studios from releasing content whenever they would like. In fact, we've already seen that some of the major studios are releasing movies in exactly this manner (prior to DVD release), despite claiming that it's impossible to do so without enabling this form of DRM.

If the movie industry wants to add a new window where they release movies for pay-per-view offerings before they come out on DVD, there is nothing stopping them from doing so today. Nothing.

The claim that this is about preventing "piracy" is flat out bogus. Even the movie studios themselves claim that nearly every movie is already "pirated" by the time the movies hit the theaters. And these pay-per-view offerings (they like to call them video on demand, but it's really pay per view) are for a window later than the theater release. So the movies will already be available via unauthorized channels. That won't change at all.

So, what are we left with? The two main arguments simply don't make sense at all. There's nothing stopping the studios from adding this window now. And enabling selectable output control (SOC) to stop your DVR from recording these movies won't do a damn thing to reduce unauthorized file sharing of the same content. The only thing it will serve to do is make legitimate customers pissed off, because they'll be confused and annoyed when the DVR they purchased to record what comes out of their TV sets refuses to record this movie that they legally are accessing, but want to time shift (which, again, is perfectly legal).

Contrary to the MPAA and the NCTA's bogus claims, this has nothing to do with enabling some "awesome" new service. This has everything to do with trying to lock down your TV and DVR in an age when consumers are finally getting back some control. What's amusing, of course, is that this comes just as the TV industry is finally realizing that letting consumers do what they wanted with DVRs didn't harm the TV industry, but helped it. One of these days, maybe the MPAA and the NCTA will come to that realization as well. In the meantime, though, they want to get a foot in the door to let them stop your DVR from working as advertised, in the misguided belief that they need to push back on what legitimate consumers want to do with the content they watch.

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Cable Lobbyists Side With MPAA On Getting Permission To Break Your TV

from the not-really-a-surprise dept

As Hollywood keeps asking for permission from the FCC to break your TV with Selectable Output Control, it's picked up an unsurprising ally. Cable companies. NCTA, the lobbying group that represents the cable industry has come out in favor of the request, claiming that it will let them offer movies earlier. This is a myth that they want regulators to believe. The MPAA and cable companies could offer up movies whenever they want. They just don't want people to record them, because they want to introduce yet another annoying window. So, they declare that they need to break your TV and DVR from recording. Hopefully, the FCC knows better than to break TVs and piss off so many people just because Hollywood is upset some people will want to record movies.

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Kentucky Cable Companies Point Out That Connected Nation Isn't All That

from the well,-look-at-that dept

It's seemed like a foregone conclusion that the US gov't was going to hand over lots and lots of cash to Connected Nation -- a group favored by the telcos -- to handle all of the "broadband mapping" needed for a better national broadband plan. There have been plenty of concerns about Connected Nation's close relationship with the telcos, as well as its proposal which wouldn't give a very fair or accurate picture of actual broadband offerings around the US. But a funny thing just happened. Connected Nation is really based on Connect Kentucky, where this experiment was first run, and the cable companies there have suddenly stood up to oppose Connect Kentucky, questioning its ability to accurately map broadband in the state. Looks like maybe the telcos should have cut the cablecos in on the deal before backing Connected Nation.

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Comcast And Time Warner Team Up To Control What TV You Watch Online

from the consumers-anyone? dept

There's certainly been plenty of talk lately about how efforts like Hulu to move television shows online could undermine the television industry as people start to realize that they don't need to pay gobs of money to a monopoly cable provider (other than maybe for broadband). The TV content folks believe this is a problem as well, because the cable companies currently pay them corporate-sized gobs of money for the rights to offer their channels to end customers. This leads to regular fights between cable companies and content providers -- but neither really want to see that old system go away. The cable companies want end users to keep paying monopoly-inflated gobs of money, and the content creators want that hefty check from the cable companies.

So, it was no surprise back in February to hear of plans to make agreements between cable companies and content providers that would limit what kind of video you could watch online, requiring you to be a cable company subscriber and "authenticating" what you could watch. Thus, it should be no surprise that Comcast and Time Warner are now announcing exactly that.

This should raise all sorts of antitrust concerns. First, you've got industry execs working together to limit consumer choice, and these industry execs already have quasi-monopolies in certain regions. And they're doing this to keep prices high against competition from the internet. Doesn't that seem like a problem?

The real issue, of course, is that the equation is (as it so often is with such companies) backwards. Rather than embracing what the internet allows these companies to do, they're trying to remove that ability, and make it act like good old television, with those good old revenue streams -- and, amusingly, claim it's "the future of television." Not even close. It's television's past, with an attempt to move it to the internet without any real advantages. As Om Malik points out in the link above: "The deal makes it painfully obvious that everything cable companies do... is done to save their video franchises." It's not about looking forward. It's about preserving the past.

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Will Content Company Greed Destroy The Pay TV Business?

from the it's-getting-there... dept

While we've noted that the various studios, such as NBC Universal have, in the past, laughed off the idea that people would ever cancel their cable TV service in favor of just getting their content online, they're clearly waking up to the problem. That's why they freaked out about services like Boxee, despite the fact that Boxee is just a TV-optimized browser for legal content. Still, Saul Hansell, over at the NY Times, gets to the heart of the matter, by noting that the content providers have kept jacking up their prices to cable providers, and those costs keep getting passed on to users. Right now, it hasn't been a clear problem, as subscribers have increased, but the costs keep getting higher, and it's eventually going to drive customers to seek alternatives. We've seen this in the past, of course: Hollywood execs try to squeeze more and more out of people now with no thought for how that will impact revenue in the future. That's not a very good way to run a business, and the TV content providers are going to start discovering that sooner rather than later, if they don't start paying attention.

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Are Cable Companies Looking To 'Emulate' Web Video Sites, Or Destroy Them?

from the face-value? dept

A piece in BusinessWeek says that cable TV companies are "pushing to become more Web-like" by expanding their online video offerings and making their core TV product work more like the web than the traditional channel-delineated system. On the face of it, this is a good thing, since we've long argued that the TV channel is an outdated concept, and should be seen as being like a web bookmark more than anything. But the article largely glosses over one key point in the cable companies' push to grow their online video efforts: they want exclusivity. So instead of throwing things open and using an ad-supported model, like Hulu, they want to take TV shows and video content, and lock it up inside a walled garden for paying customers. That's not "web-like", it's exactly the same as their current business model. Of course, even if these plans don't work out, they've got another way to try and profit from online video: by introducing capped broadband plans that will charge customers based on how much traffic they use. Time Warner's CEO is quoted in BW as saying "we really need to look at what consumers want." It's hard to imagine they want capped broadband, and they want video locked up behind paywalls. The popularity of the likes of YouTube and Hulu indicate they want something very different from what the cable operators have in mind.

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

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What If Newspapers Follow The ESPN 360 Model?

from the there-would-need-to-be-enough-value dept

Mark Cuban, picking up on the rumors last week that the cable companies are negotiating with content providers to offer their channels over the internet, has a suggestion for newspapers: do the same deal. Specifically, he's suggesting that newspapers get broadband providers to pay them to provide access to their content to subscribers. The idea is that in a sort of Coasian bargain, it allows the newspapers to get more money (from just a few companies, rather than from tons of advertisers and subscribers) and it allows the ISPs to differentiate. In reality, this is just the controversial ESPN 360 model all over again. ISPs pay a content provider, and only subscribers to that content provider get access to that content. The content provider gets easy cash, and the ISP gets differentiation. It basically just hides the paywall. Rather than individuals paying for the content directly, they pay for it indirectly via their broadband connection.

What could go wrong?

Well, plenty, actually. First of all, that content really does need to be differentiated. That might sorta (but not totally) work with ESPN, but it's not going to work with most newspapers -- where the competition is pretty strong. The ISPs won't be willing to pay very much because the "value" in differentiating isn't very high. The fact that ESPN is getting away with this isn't so much a statement on how good a business model this is, as it is an indication of just how lousy many other sports content sites remain. That, however, represents a nice opportunity for other sports sites to step up and provide better content.

But, more importantly, cutting off open access to news in this manner creates the same exact problems that paywalls created. It cuts off the ability to interact with the news: to share it and spread it to others. You can still comment on it... somewhat, but the inability to have everyone you interact with see the same content is a greatly limiting factor in discussing a particular story. It actively decreases the value of the news, which is the last thing news organizations should be doing these days. It shrinks their one real asset: their community. The problem is that Cuban (and many others) still seem to be thinking about the issue from the perspective of a broadcast media company, pushing a message out to people, rather than a communications media company. When you realize that news operations need to be communications companies, the idea of making content harder to access seems more and more ridiculous.

Either way, we may soon get an example of how poorly this works in practice. Many are suggesting that Cablevision's decision to charge for access to Newsday is really a way to test this in action. The company can give Cablevision internet service customers Newsday for free as an extra incentive. But, once again, that assumes people think that's actually an incentive.

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Cable Companies Negotiating To Control What TV Shows You Can Watch Online

from the this-won't-end-well dept

Earlier this week when Hulu cut off Boxee, supposedly at the request of its content partners, there was some speculation that the real pressure may have come from the cable companies who are losing customers at a pretty rapid clip. And, while the content companies pretend to deny it, the fact that people can get so much content for free online is almost certainly contributing to that situation.

Now, in theory, this should be a good thing for the TV guys -- who you would think want as many people watching their shows/channels as possible. But, the problem is the business model. Doesn't it always seem to come down to the business model? The TV networks make so much money by selling the channels to the cable companies, that they're scared to death of losing that revenue. We saw a hint of this late last year when Viacom and Time Warner Cable played a big game of chicken over channels like Comedy Central and MTV.

However, now reports are coming out that the cable companies are negotiating with TV programmers to offer their TV content exclusively via their cable internet offerings. In other words, forget Hulu and routing around the cable company and the $80/month they're charging you. You'd have to keep your cable, even if you don't want it, just to get access to many TV shows over the internet (well, legally). Not surprisingly, both the cable companies and the TV programmers seem to like this sort of deal: the programmers continue to get their big fees from the cable companies, and the cable guys avoid losing many more subscribers. Comcast's CEO Brian Roberts is even saying "Online video is our friend, not our enemy."

And, to some extent he's right. If Comcast is going to survive it does need to look at online video as a friend, rather than an enemy -- but the problems may come about if they think that they can force customers to only get online TV if they keep their cable TV service at such a high price. Because, while these deals may make sense for the TV networks and the cable guys, they seem to be forgetting the customers -- many of whom have received a nice taste of TV online for free, and aren't going to be happy about having to pay up for it. The problem is that these cable guys aren't adding any new value. In actuality, it seems like they're looking to take away value from what's already out there -- and that never works. It will likely just lead to increased piracy, increased anger at the cable companies, and a continuing of the downward spiral. But, these days, watching old school companies accelerate their own downward spiral happens so often, you almost have to assume it's likely.

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Cable Companies Hold Off On Digital Conversion To Avoid Confusion (And Potential Lawsuits)

from the makes-sense dept

There's tremendous confusion out there about February's required switch for broadcast TV from analog to digital. For example, an awful lot of people who have cable or satellite TV don't realize that this conversion basically has no impact on them. It's only for over-the-air TV (you know, the kind you used rabbit ear antennas for). Many assume, incorrectly, that it has something to do with cable TV's "digital TV" or (even less related) needing to get HDTV. Digital TV and HDTV are two separate things. Yet, there has been some accusations that cable companies are taking advantage of this confusion to get people to upgrade, even if they don't need to. In response to such criticism, cable TV operators have now all agreed to put their own digital conversion plans on hold until after the over-the-air conversion is complete, to avoid "complexity." It might also help them avoid lawsuits for misleading consumers...

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Sorting Out Truth From Fiction In The Cable/Telco Customer Retention Mess

from the smoke-and-mirrors dept

Back in March, we wrote about a complaint to the FCC by cable companies about how Verizon was abusing the number portability system to try to retain customers. In April, Kevin Martin took his expected position in siding with Verizon, the telco. However, it appears that only Martin was convinced. All the other FCC commissioners went in the other direction and sided with the cable companies, smacking down Verizon and telling it to stop.

What's impressive, though, is the response and the amount of misinformation flying around. Even before the official vote, Verizon's policy guys put up a blog post claiming that this decision would hurt customers. That resulted in a spirited discussion in the comments on that post between Verizon's public policy guy and a cable lobbyist. There have also been some interesting discussions among public policy followers, with some, like James Gattuso, buying Verizon's take that this is bad for consumers, and others, like Karl Bode, noting that Verizon's spin on this appears to be pure "nonsense."

The reality appears to be somewhere in-between. Verizon is clearly overplaying the situation in claiming that the FCC is saying that it cannot market to customers who have chosen to leave Verizon for cable. That's not what this argument is about, and James Gattuso is incorrect in suggesting that the "question at hand" is really about whether or not Verizon can contact customers who have agreed to switch and ask them not to switch. That's certainly the way Verizon wants you to think about it, but that wasn't really the question. No one is saying that telcos (or cable companies) for that matter, can't try to convince customers not to switch. What the FCC has said is that Verizon cannot abuse its position to block the switch while it tries to convince customers not to switch. That's what Verizon is doing. When it gets the request from the cable companies to switch, it basically goes into procrastinate mode, even though it's required to process the switch. It codes the switch request as a "conflict" which gives it extra time to resolve the "conflict" before obeying the switch request.

That's not the same as simply asking the customer not to switch. It's abusing the technical process for marketing purposes. The FCC has not said that Verizon (as Verizon claims) cannot try to entice customers to stay, or to win back those customers who have decided to leave. All it has said is that Verizon cannot stall and block the change request, once it's been placed, in order to try to win back the customer before the change is made. Once the customer has committed to the change, Verizon should be required to process it, rather than block it. So, don't buy the story about Verizon no longer being able to win back customers or entice them with reasons to stay. That's got nothing at all to do with this decision.

Update: Gattuso responds. I still think he's buying Verizon's spin on this ruling. Verizon is falsely claiming that it cannot market to customers who have decided to leave. That's false. They simply cannot abuse the fact that they have access to certain information from the group that has to make the change to market to them. They can still market to them through other means. In other words, Verizon's complaint here does not fly.

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Cable Companies Looking To Buddy Up With Sprint Once Again To Save WiMax

from the let's-see-how-this-works... dept

Remember a couple years ago when all the big cable companies teamed up with Sprint with plenty of fanfare to provide mobile phone service and to compete against Verizon and AT&T? Whatever happened to that? Oh, right, it went nowhere. So, perhaps don't get too worked up over the news today that cable companies Comcast and Time Warner might be teaming up with Sprint and Clearwire to fund their troubled WiMax efforts. If you recall, Sprint and Clearwire had a huge deal (with hundreds of millions in backing from Intel) to WiMax the nation, and that deal also fell apart though everyone knows they've been seeing each other on the sly. They know they can't do it alone, so certainly having some support from Comcast and Time Warner could help move this project forward, but there have been so many false starts and stumbles that you can bet this isn't going to go as smoothly as all the players are about to suggest.

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Cable Companies Accuse Verizon Of Shady Practices To Prevent Customers From Leaving

from the so-we-hear-you're-leaving... dept

Comcast and Time Warner have complained to the FCC that Verizon is taking unfair advantage in preventing customers from dropping their phone service. The basic story is that the cable companies have been offering deals on various "bundles" of TV, internet and phone service, all over cable. When customers agree to switch, most want to keep their existing home phone number (which is allowed under number portability rules). The cable companies take care of that part, informing the phone company of the switch -- at which point (the cable companies say) Verizon calls up those customers and offers them cash discounts to stick around. While it's quite common for telcos (or other firms for that matter) to offer customers who cancel deals to stay, this is somewhat different. The customer hasn't called to cancel in this case. It's just because Verizon owns the telephone network that it finds out about the switch and then proactively contacts the customers. Given the FCC's extra friendly terms with the telcos rather than cable co's, anyone think this has a chance of getting anywhere?

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Drunk Off Patent Success Against Vonage, Verizon Moves On To Cox

from the who's-next dept

Having successfully sued Vonage over VoIP patents, despite an inferior product and plenty of prior art, it appears that Verizon is seeing who else it can sue for VoIP patent infringement. First on the list is cable provider Cox, who offers VoIP to its customers, just like most cable providers these days. A successful lawsuit against Cox would almost definitely mean additional lawsuits against all the other cable providers, who have also been much more successful than Verizon in actually offering a VoIP service that customers find useful. Of course, in this day and age, it seems that rather than improve the product, the answer is to sue everyone else for patent infringement. Just like the Founding Fathers intended.

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