Dropped By Dish, AMC Pulls An Anti-Viacom: Offers Breaking Bad Premiere Free To Dish Subscribers

from the that's-how-it's-done dept

Yesterday, we wrote about Viacom's reactionary strategy of holding its fans hostage by shutting down online streams of The Daily Show and The Colbert Report after DirecTV advised its customers (who just lost access to Viacom shows) to watch them online. It was a childish move that punished a whole lot of fans (not only DirecTV users) just to gain leverage in a contract dispute, and a textbook example of how big media's shortsightedness drives people to piracy. Nobody was impressed.

So today it's interesting to hear about a network taking the exact opposite tack. AMC, home of a bunch of popular shows cast somewhat in the HBO mold, was recently dropped from the basic package for Dish satellite subscribers. AMC says that unlike the Viacom/DirecTV situation, they were not asking for more money and this was not a negotiation issue, but rather Dish trying to "gain leverage in an unrelated lawsuit."

So what is AMC's response? Well, the much-anticipated fifth-season premier of Breaking Bad, one of their flagship shows, is airing on Sunday—and they've decided to set up a special online stream just for Dish subscribers, so they can watch it for free. Meanwhile, they point out that virtually every other satellite and cable provider includes AMC in its basic package, and that several are now offering special sale prices for customers switching from Dish. They even have a toll-free line at 1-855-2DROP-DISH offering more information. For Dish, this is what you call a "PR nightmare".

But -- and here's where it gets even more interesting -- Dish claims they dropped AMC because the company insists they also carry some other less-popular networks bundled with it. That's why DirecTV says it dropped Viacom, too. It's a bit of an our-word-against-theirs situation as to the real cause of the conflict, and it's likely that neither company is entirely blameless. But AMC's first move was to go straight to the fans with a special offer to give them what they want. Viacom's first move was to... petulantly punish not only the fans involved in the dispute, but all of their fans.

Both Dish and DirecTV are experiencing backlash—even though some people support DirecTV in the bigger picture, most fans are just reacting to their favorite shows suddenly disappearing, and understandably getting annoyed with their service provider. But while AMC has leveraged the situation as a way to get good PR by offering fans something special, Viacom managed to extract its own dose of negative backlash by further depriving them.

Much like the MPAA, it seems Viacom needs a lesson in communications.

Filed Under: breaking bad, public relations
Companies: amc, directv, dish, viacom

Viacom Uses Fans As Hostages: Blocks Daily Show, Colbert Streams For Everyone To Spite DirecTV

from the um.-overkill dept

So, as the dispute between Viacom and DirecTV over how much money Viacom wants for its channels wore on, the various Viacom channels like MTV, Comedy Central and Nickelodian disappeared for DirecTV subscribers. As often happens in such situations, DirecTV told its customers that they regretted the situation and were working on it, but in the meantime, they could check out missing programs online. Viacom's massive overkill response? Pull the free streams it offers online of two of its most popular shows: The Daily Show and The Colbert Report. For everyone. Not just DirecTV subscribers. Because, apparently, pissing off consumers and driving them to unauthorized means, is... um... I don't know... supposedly going to get them on Viacom's side? This is the kind of "strategic" thinking that goes on at Viacom, apparently. Of course, this really highlights the exceptionally distorted economics of the cable/satellite TV business, where it makes more sense to block your direct relationship with fans and piss them off... in the hopes that it might make the satellite provider to pay you more money. Viacom's new motto, apparently, is: Using our fans as hostages. This is why the TV market is so ripe for disruption.

Filed Under: stephen colbert, television, the daily show
Companies: directv, viacom

HBO Decides It Still Isn't Difficult Enough To Watch HBO Shows

from the drm-doesn't-work dept

We've recently discussed the fact that HBO severely limits the availability of its shows to non-subscribers, and I've speculated that the success of HBO-style programming owes a lot to piracy as a way around those restrictions. But HBO is terrified of piracy—so terrified, in fact, that they're willing to toss roadblocks in the path of their subscribing customers as well. Ars Technica saw some complaints on a satellite forum, and discovered that DirecTV users with older DVRs and TVs are suddenly unable to watch HBO shows, thanks to newly-activated encryption:

"No problem until today trying to watch HBO," a standard definition TV owner with an HR 20 DVR noted on Saturday. "Get message that the program is content protected. I can view every other channel except HBO. This wasn't the case last week. Something new?"

Ditto declared another poster a few hours later: "Noticed something strange this week also regarding HBO. Although my Sony is connected via HDMI I get the message that my 'set is not compatible with..... ' displayed too briefly to read in its entirety. It is displayed when changing between HBO channels. Same TV, same HR20 for nearly six years, never a problem prior to this."

...

"As of today, I can no longer watch HBO over HDMI to my television," another consumer disclosed. "I get an error message that says 'HDMI connection not permitted. Press SELECT for more information.' (And pressing Select does nothing.)."

Turns out the problem is HDCP encryption, a newer part of the HDMI standard that premium channels are requiring pay TV operators to implement. Ostensibly this is to stop people from obtaining high-definition copies of movies and TV shows—but of course, HDCP was cracked a while ago and this will do little or nothing to stop the dedicated (and highly organized) groups that make such copies available. Meanwhile, it forces a bunch of paying customers who were happily and habitually enjoying the content to suddenly go out and get expensive new equipment (or, quite reasonably, turn to piracy to replace what was taken from them even though they still pay for it). DirecTV suggests a workaround—switching to component video instead of HDMI—but as Ars points out, this is a pretty weak response: component video is much lower quality, and some content still won't work, because first-run movies employ selectable output control (another silly DRM restriction) to prevent analog output.

It's truly amazing that companies like HBO still pursue such strategies. There is not, and never has been, a form of DRM that effectively prevents piracy—but every single form of DRM reduces the value of the product to legitimate subscribers. It's pretty bizarre to continually punish the only people who aren't engaged in the behavior you want to stamp out.

Filed Under: drm, encryption, hdcp, hdmi, piracy
Companies: directv, hbo

News Corp. Accused Of Hacking Competitors Smartcards To Increase 'Piracy' Of Satellite TV Rivals

from the all's-fair-in-murdoch-land dept

Four years ago, we wrote about claims that News Corp. had hired hackers to break the encryption on DISH Networks' satellite TV smart cards, and to "flood the market" with those cards, thereby increasing "piracy" of DISH's service. News Corp., of course, owned DISH's main competitor, DirecTV. The whole thing seemed really bizarre, and we were skeptical. This kind of thing only makes sense if you actually believe that "piracy" like that directly takes away money from the company whose service is hacked. But, it seems just as likely that flooding the market with hacked smartcards would take away business from both DISH and DirecTV in the cases where it was a true substitute (rather than going to people who would never pay for either anyway). Either way, that case ended with a jury finding News Corp guilty... but of just hacking one smartcard, for which the company was fined a grand total of $49.69... and another $1,000 for "damages." Honestly, I'm not even sure that makes sense, because if it just hacked a single smartcard, it sounds like it may have just been for reverse engineering purposes.

Of course, in the intervening years, News Corp.'s name has become a lot more closely tied to the word "hacking" thanks to the News of the World scandal where reporters regularly "hacked" into voicemails (and, by "hacked" I really mean used a widely known loophole that makes it easy to listen to many people's voicemails). So with news breaking that News Corp. is again being accused of hacking, a lot of people are thinking about the recent scandals -- but the details suggest that this may have been identical to the DISH/DirecTV story above, but with a UK focus. Basically, News Corp's subsidiary NDS is accused of hacking ITV Digital, a UK competitor to News Corp's Sky TV.

In this case, there are some more details, where it certainly suggests that at least someone at News Corp. was working closely with some hackers to publish the codes necessary to make unauthorized smartcards for ITV. ITV eventually did go out of business, and of course the article linked above quotes an exec there insisting that such "piracy" was "the killer blow for the business, there is no question."

Again, this doesn't make much sense to me. Even if all of these actions were done via News Corp., how does that actually help News Corp? People who got the hacked ITV smartcards weren't going to buy Sky TV services either. The whole thing seems pretty strange, suggesting it was either exaggerated, or whoever at News Corp. decided this was a reasonable strategy didn't even think about how getting more hacked smartcards would likely be a challenge for Sky just as much as it was for ITV.

Filed Under: competition, hacking, james murdoch, piracy, rupert murdoch, satellit tv, smart cards
Companies: directv, dish network, itv, news corp., sky tv

DirecTV Admits Almost No One Wants To Pay $30 To Watch A Movie At Home

from the pricing,-duh dept

Back in April, when DirecTV officially announced its plan to let people see movies for $30 at home, we were not alone in suggesting the price was ridiculously high, and were somewhat shocked to see theaters complaining that they'd never be able to compete. Looks like our thoughts on the price turned out to be exactly right. As a few people have sent in, DirecTV has admitted that there's been very little uptake of the $30 movies, and flat out admits that the price is too high:

The service is part of an attempt by studios to harness pay-TV as they seek new ways to sell movies and counter shrinking DVD sales. Few customers will purchase the premium rentals unless the quality of the movies improves and the price comes down, White said in an interview.

“They’re priced too high for consumers,” White said. “We didn’t choose that price, but that’s where the studios forced us to be.”

Of course, the studios forced that price because they're petrified of pissing off the theater owners (who were already pissed off), because the big studios still think that the "movie business" is defined solely and completely by how well a film does in the theaters on its opening weekend. The theater owners, at the same time, don't want to have to compete and actually improve the quality of their service -- so they whine and complain any time the studios do anything to make accessing content outside of the theaters any easier.

The end result, then, is just a big question of why anyone bothered at all with this plan. It made no sense for anyone involved. If you're going to offer video on demand to consumers, offer them a reasonable product at a reasonable price or don't bother.

Filed Under: $30, movies, studios, video on demand
Companies: directv

DirecTV Pays Studios To Help Confuse Customers Further

from the restrictions-may-apply dept

The film studios have convinced Netflix to sign deals that expand the company's access to streaming film licenses -- in exchange for agreeing to delay new releases by 28 days. Studios, of course, think this will somehow magically ramp up user purchases of physical DVDs, though it seems the primary result is going to be a lot of confused consumers, who see new releases for rent in one place, but not in another. But the studios are likely quite pleased with themselves, given the deal gives them more license negotiation power -- and allows them to charge companies more money if they want a perceived leg up on Netflix. If nobody is willing to pay, the studios figure they've still managed to create a wider delay window (the exact opposite of what should be happening in the broadband age).

But Blockbuster quickly jumped at the opportunity, throwing money at the studios, not only to avoid the new release delay, but so they could use the opportunity to mock Netflix instead of having to innovate. DirecTV has also now decided to play along, and will be paying for the honor of offering new releases under the "DirecTV Cinema" brand. Like Blockbuster, it didn't take DirecTV long to brag that unlike Netflix or Redbox, they'll be getting Avatar the same day it hits store shelves:

"As many as 400 new movies will be available this summer through DirecTV Cinema. Titles from Universal Studios Home Entertainment, Twentieth Century Fox and Time Warner Inc.'s Warner Bros. will be given to DirecTV subscribers 28 days before they can be rented on Netflix, said Paul Guyardo, DirecTV's chief sales and marketing officer"

Granted this might not hurt Netflix much, given the fact that DirecTV agreements with the studios ban them from offering subscription service, so if users want these new releases -- they have to pay between $4.99 and $5.99 per title -- nearly the cost of a Netflix subscription. You also had better hurry up and watch your movie, given that under a 2008 DirecTV agreement with the studios, movies you store on your DVR will be automatically deleted after 24 hours. While the studios think layering restriction upon restriction onto how, where and when customers can consume their product is helping them save the traditional DVD -- all they're really doing is delaying the inevitable death of physical media, annoying and confusing customers, and making it harder for people to consume their product.

Filed Under: movies, release windows
Companies: directv, netflix

Court Tells Echostar It Doesn't Get Access To Customer Lists Of Satellite Receiver Company

from the chalk-one-up-for-privacy dept

Recently, we wrote about how satellite TV provider Echostar had been sending out subpoenas demanding customer lists from resellers who had sold satellite receivers made by a company named Freetech. Freetech's satellite receivers can be used to receive perfectly legal over-the-air satellite TV signals. Echostar's complaint was that many also used Freetech's receivers to pirate its own DishTV offering. However, that doesn't give Echostar the right to then demand the contact info on everyone who ever bought a Freetech receiver, as many could be using them for perfectly legal purposes. And, historically, with DirecTV, we've seen a similar situation where the DirecTV forced plenty of totally innocent smart card device buyers to pay up by threatening them with lawsuits over pirated satellite TV.

Luckily, it looks like the EFF helped convince the judge that Echostar was out of line, and the judge has said that the buyers' privacy trumps Echostar's right to the info. As the EFF notes, this is a big ruling, in that it's "the first time a federal court has explicitly rejected a third-party subpoena on the basis of the privacy interests of nonparty consumers." Chalk one up for the right to privacy.

Filed Under: eff, piracy, privacy, satellite tv, subpoenas
Companies: directv, echostar, freetech

Echostar Trying To Get Info On Innocent Customers Of Satellite TV Receivers

from the this-again? dept

You may recall a few years back, prior to the RIAA embracing the concept of "pre-litigation letters," that DirecTV was a huge proponent of using them. The company had sued some companies that sold smart card readers -- which could be used for a variety of purposes, only one of which was potentially unauthorized access of satellite TV signals. However, DirecTV was still given access to those company's full customer lists, and proceeded to send most of them one of those pre-litigation letters, demanding $3,500 or saying that a lawsuit would be filed. Of course, plenty of buyers had perfectly legitimate reasons for purchasing a smart card reader that had nothing at all to do with pirating satellite TV. But, no matter, pay up or go to court. And, in fact, many people just paid up.

Eventually, a court finally told DirecTV to knock it off.

However, it appears that DirecTV's main competitors, Echostar never got the message. The EFF is pointing out that Echostar is trying to gain access to the customer lists of a bunch of sellers of a satellite receiver even if there's no evidence that the individual buyers used the satellite receivers to pirate Echostar's DISH Network satellite TV service.

Filed Under: customers, piracy, privacy, satellite receivers, satellite tv
Companies: directv, echostar

Dish And DirecTV Figure If XM And Sirius Can Merge...

from the try-try-again dept

You may remember back in 2001 that EchoStar, then owners of the DISH Network, tried to buy DirecTV from then owner Hughes (who was owned by GM at the time). However, after the Justice Department said no to the deal over antitrust concerns, it fell apart. However, the rumors going around are that the two companies (now just DISH Network and DirecTV, sans various parent companies) are thinking about trying again. Apparently, they believe that the regulatory and competitive environment that doomed round 1 wouldn't happen in round 2. And, of course, this time around, they can point to the fact that the two satellite radio systems, XM and Sirius, were allowed to merge (even if it took a year and a half).

Filed Under: antitrust, mergers, satellite tv
Companies: directv, dish network

Did DirecTV Hire Satellite Hackers To Leak Dish TV Smart Cards?

from the seems-a-bit-extreme dept

I had missed this story when it came out last week, but thanks to a reader (who prefers to remain anonymous) for sending it in. Apparently, Dish Network is suing DirecTV, claiming that DirecTV (and its parent News Corp) hired notorious satellite TV hackers to break Dish's encryption and "flood the market" with hacked smart cards. That's quite a claim, and it will be interesting to see what evidence the company has to back it up. After all, reverse engineering a product is perfectly legal -- and, indeed, DirecTV claims that's all it did. Furthermore, it seems doubly strange that DirecTV would go down this route after so thoroughly pissing off smart card hackers of all kinds a few years ago by accusing them all of stealing DirecTV signals with almost no evidence, and then pushing many to pay up to avoid a lawsuit. It's also hard to see what the real benefit to DirecTV is of such a plan. Making it easier to get Dish for free shouldn't increase DirecTV's market at all. One would hope that Dish actually has some serious evidence to go along with these claims.

Filed Under: competition, hacking, satellite tv
Companies: directv, dish, echostar, news corp