Netflix's Assault On VPNs Is Stupid, Annoying And Erodes User Security

from the international-charade dept

Earlier this year Netflix surprised everybody by announcing it was expanding into 130 additional countries, bringing its total footprint to 190 markets. But alongside the announcement came the less-welcome news that Netflix was also planning to crack down more on "content tourism," or the act of using a VPN to trick Netflix into letting you watch content specifically licensed for other countries. If you take a look at what's available per country, the motivation to use a VPN to watch content not available in your market becomes abundantly obvious.

And while the press and public engaged in a lot of hand-wringing about Netflix's decision to crack down on VPN use, it really wasn't much of a problem for most VPN providers to bypass Netflix's restrictions. And indeed, if you'd been paying attention, you would have noticed Netflix basically admitting that this "crack down" wouldn't be much of one, since even the company realized it was largely futile:

"We do apply industry standard technologies to limit the use of proxies,” (Netflix chief product officer Neil) Hunt says. “Since the goal of the proxy guys is to hide the source it’s not obvious how to make that work well. It’s likely to always be a cat-and-mouse game. [We] continue to rely on blacklists of VPN exit points maintained by companies that make it their job. Once [VPN providers] are on the blacklist, it’s trivial for them to move to a new IP address and evade."

So why is Netflix engaging in a practice it realizes is largely pointless? To try and calm global broadcasting partners terrified by the fact that Netflix is re-writing the rules of global television and eroding the power of global media empires unchallenged for the better part of a generation. Netflix still needs to strike licensing deals with many of these companies, and to do so these broadcasters need to see Netflix as a partner, not a threat. So to keep these companies' executives calm, Netflix is basically giving a used-car-salesman-esque wink and saying "sure, we'll make sure your outdated regional restrictions still hold," even though Netflix's publicly-stated goal is demolishing region restrictions completely.

All of that said, Netflix's "crack down" on VPNs still has a notably negative impact on global user privacy and security. And as Dan Gillmor at Slate noted this week it's just downright annoying for the millions of paying customers that use a VPN everyday as a part of their routine security and privacy arsenal:

"No doubt this pleases the Hollywood studios, the control freaks of copyright. From this video watcher’s perspective, it’s beyond annoying. I don’t download Hollywood movies or TV shows from torrent sites. I pay, willingly, for streaming and DVD rentals and, for some special films, an outright DVD purchase. Yet I’m being punished when I stream video because I also want security. So are countless others who want to do the right thing. Tens of thousands have signed an online petition asking Netflix to reconsider."

It's unlikely that Netflix plans to do much about this in the short term. It knows most VPN providers will continue to provide workarounds for customers who know better, and is apparently willing to alienate and annoy customers unwilling or unable to switch VPN providers for the temporary, artificial benefit of its broadcaster relationships. If Netflix continues to be successful the good news will be that regional restrictions will die; the bad news is it's relatively clear the company doesn't give a damn about the repercussions as we wait the decade or longer it's going to take Netflix to actually accomplish this.

Filed Under: copyright, geoblocking, security, streaming, vpn
Companies: netflix

Netflix Mocks NBC's Obsession With TV Ratings Systems Built For A Bygone Era

from the the-wailing-of-the-dinosaurs dept

Last week, NBC executive Alan Wurtzel boldly claimed that Netflix and YouTube weren't threats to traditional cable. His only evidence? Data purchased from a company named Symphony that guesstimates Netflix's closely guarded viewership numbers. That data actually showed Netflix's viewership numbers for its original series are impressive, but found that viewership wanes a little once users get done binge watching. That's it. The data didn't really support Wurtzel's claim that Netflix doesn't pose a threat to traditional cable, NBC was just boasting that it had figured out Netflix's viewership tallies.

Symphony was born out of the well-documented failures by Nielsen to track consumer viewing on new platforms, and not only tracks every viewing habit of some 15,000 Netflix customers, but also uses GPS data to track where these customers are viewing the content. It's a welcome improvement for an industry that spent the last decade paying for data that only told it what it wanted to hear: namely that cord cutting and Internet video weren't a serious threat.

And while trying to understand your competitors makes sense, it's hysterical how Netflix's hidden viewership numbers seem to drive traditional broadcasters absolutely crazy. You'll recall that CBS threw a similar hissy fit last year, clearly upset that Netflix doesn't have to adhere to traditional ratings metrics because it's not an ad-supported legacy service.

Netflix chief content officer Ted Sarandos also spoke at the same Television Critics Association meeting, and first highlighted how it's telling that NBC took its allotted time at the meeting to obsess over Netflix:

"Given what is really remarkably inaccurate data, I hope they didn't spend any money on it," he said of the numbers. "There's a couple mysteries at play for me. Why would NBC use their lunch slot to talk about our ratings? Maybe because it's more fun than talking about NBC ratings. … The methodology doesn't reflect any sense of reality we keep track of."

But then Sarandos went on to make what's probably the biggest point (and one CBS and NBC clearly don't understand): the existing ratings measurement system doesn't matter when you're not reliant on traditional advertising.

"I can't even tell you how many 18-49 users we have … we don't track them," he said. "Those sample sets don't give you a lot of information when people are watching thousands of shows [on Netflix] around the world. Somewhere in the world, every second of every day, someone is pressing start on a Netflix original. … There is not an apples to apples comparison to Netflix watching and any Nielsen rating."

Sarandos noted that the specific numbers — Wurtzel had 4.8 million adults 18-49 watching Jessica Jones, followed by Master of None (3.9 million adults 18-49) and Narcos (3.2 million adults 18-49) — wouldn't even be relevant to his business if they were true. "The ratings themselves have no specific impact on the business," he added. "If we were spending a lot of money on shows people weren't watching, they will quit. People are finding value in how we're spending our content dollars … if they're watching today, tomorrow or seven days from now."

As for NBC's claim that binge watchers always return to watching TV in the "way god intended," Netflix noted in its quarterly letter to shareholders (pdf) that "our investors are not as sure of God's intentions for TV, and instead think that Internet TV is a fundamentally better entertainment experience that will gain share for many years." Obviously the histrionics by broadcast executives surrounding Netflix obfuscating its viewership numbers originate in jealousy; jealously that Netflix gets to operate under a new paradigm where traditional ratings are less important, while legacy sector executives have to stare at charts like this one:

The collapse of broadcast TV ratings. How close to zero before we stop talking about "broadcast", "TV" & "ratings"? pic.twitter.com/4IWnkNAe1J

— Chris Anderson (@chr1sa) January 18, 2016

And while it's great that the traditional cable and broadcast industry is finally cooking up viewer measurement systems that challenge its long-held delusions about cable's infallibility, the petty sniping at Netflix really isn't all that flattering and isn't going to help them compete anytime soon.

Filed Under: streaming, tv ratings
Companies: nbc, netflix, symphony

VPN Providers Laugh Off Netflix's New Futile War On VPNs

from the Whac-a-mole dept

Last week, we noted that the press spent much of the week hysterically claiming Netflix was waging a massive new war on VPNs and proxies to crack down on out-of-region viewing. Of course if you bothered to actually read Netflix's blog post on the subject, you'd note that Netflix wasn't actually implementing anything new. It was simply taking the same, modest attempts to block VPNs it has been using for several years into the 130 countries it just expanded into. These are, it should be noted, the same systems that Netflix's Neil Hunt just got done telling CES that they don't actually work:

"It’s likely to always be a cat-and-mouse game. [We] continue to rely on blacklists of VPN exit points maintained by companies that make it their job. Once [VPN providers] are on the blacklist, it’s trivial for them to move to a new IP address and evade."

So yeah, Netflix knows a war on VPNs and proxies is futile, it's just trying to placate broadcasters in new partner countries. Those broadcasters are (quite correctly) nervous about Netflix coming to town and utterly demolishing the kind of power and influence they've enjoyed for a generation or more. As we saw in Australia, many of these companies aren't really familiar with what competition looks like and don't really understand how technology works, so they've been pressuring Netflix and governments to wage war on VPNs -- as if this is going to somehow save them from the looming Internet video revolution.

And, right on cue, VPN providers are noting that what Netflix is doing may be annoying, but it's relatively trivial to bypass, since they can simply switch IP ranges and avoid Netflix blacklists:

"TorGuard is monitoring the situation closely and we have recently implemented new measures that can bypass any proposed IP blockade on our network. VPN users who encounter Netflix access problems are encouraged to contact us for a working solution,” he adds.

SlickVPN takes a similar stance and says that the static IP-addresses they offer are less likely to be blocked.

“We work tirelessly to ensure our customers have access to the entire internet. If we find that our IP addresses start to become blocked we’ll migrate to new IPs as needed. We also offer the option of static IPs which eliminates the problem entirely,” SlickVPN’s Greg Lyda says.

So in short, Netflix isn't really engaging in a massive new war on VPNs. It would be more accurate to say it's making a token effort to thwart VPNs it knows won't work, to appease necessary broadcast partners who don't really understand the technology they're whining about. None of this is to say that what Netflix is doing is good for the Internet or for its users, but it's a temporary hiccup on the path toward Netflix's eventual goal: uniform, consistent content licensing that looks the same in every country, instead of the bizarre, fractured content availability many of the new Netflix launch countries experience today.

Filed Under: geoblocking, proxies, streaming, vpn
Companies: netflix

NBC Exec: Netflix Poses No Threat To Us, God Wants You To Watch Expensive, Legacy TV

from the not-just-a-river-in-Egypt dept

The traditional cable and broadcast industry's chief export is no longer quality programming, it's denial. First the industry denied cord cutting even existed. Then it acknowledged it existed, but pretended it was only something losers living with mommy had any interest in. More recently the cable industry has acknowledged that yes, there is something that vaguely looks like a mammoth tsunami looming on the horizon, but people are totally overreacting because the cable industry is just so god damned innovative.

Historically, the cable industry has needed all the help it could get when it comes to laboring under the delusion that the legacy cable cash cow will live forever. And, as Nielsen's failure to provide real data on cord cutting has shown, the industry employs plenty of people happy to take money in exchange for telling industry executives precisely what they want to hear. Lending a hand this week was NBC's president of research and media development Andy Wurtzel, who proudly told attendees of the Television Critics Association's winter press tour that neither Netflix nor YouTube pose a "consistent" threat to cable.

His only evidence? That Netflix's top shows still only get a fraction of the viewership that traditional cable gets:

"Symphony measured the average audience in the 18-to-49 demographic for each episode within 35 days of a new Netflix series premiere between September and December. During that time, Marvel's Jessica Jones averaged 4.8 million viewers in the demographic, comparable to the 18-to-49 ratings for How to Get Away with Murder and Modern Family. Master of None drew 3.9 million in the demo and Narcos was third with 3.2 million."

Nobody denies that cable TV's audience still towers over that of streaming video services. That's never been in dispute. Nor has anyone really debated the fact that cord cutting is a slow but steady phenomenon (NBC's parent company Comcast lost 48,000 video subscribers last quarter). But that doesn't really change the fact that the threat obviously exists, or that cable needs to dramatically change to adapt to it. But Wurtzel for some reason seems convinced that because viewership for Netflix hit shows drops off after a few weeks of binge watching, this somehow means cable has nothing to worry about:

"Wurtzel said Symphony's data also revealed that most viewers of those SVOD shows return to their old viewing habits by the third week. "[By then], people are watching TV the way that God intended"—that is, via traditional, linear viewing—said Wurtzel. "The impact goes away."

That's because Netflix has "a very different business model—their business model is to make you write a check the next month," said Wurtzel. "I don't believe there's enough stuff on Netflix that is broad enough and consistent enough to affect us in a meaningful way on a consistent basis."

But again, cord cutting isn't about just Netflix. It's about picking and choosing among a myriad of different options as an alternative to soaring cable rates. One fifth of pay TV customers are expected to cut the cord next year. Only 51% watch live TV (as "god intended"?). Consumers are tired of paying an arm and a leg to get 194 channels while only watching, on average, about 17 of them. And, to put it bluntly, cable's biggest customers are dying, and being replaced by "cord nevers" that have absolutely no interest in paying too much for too little.

The threat is more than just consistent, it's inevitable.

Fueled by the kind of bubbly optimism provided by Wurtzel, legacy cable honestly believes it's doing a bang up job adapting to the Netflix threat. Except that's not remotely true; the industry refuses to compete on price, consistently fights more flexible programming options tooth and nail, and still confuses proclamations of "Hey, we're innovating!" with actual innovation. Were I Netflix, Amazon, Apple, or any of a million other companies eager to jump into the field, I'd be thrilled that guys like Wurtzel continue to provide a false sense of security across an industry so desperately in need of a disruptive kick in the ass.

Filed Under: andy wurtzel, broadcast tv, cord cutting, denial, internet, nbc, streaming video, tv
Companies: comcast, nbc universal, netflix

Netflix Pretends It Will Crackdown On VPNs Just Days After Admitting It's Futile To Do So

from the international-whac-a-mole dept

For a few years now, broadcasters have whined endlessly about the use of VPNs to access Netflix in markets where the streaming service had yet to launch. You'll recall that Australian broadcasters in particular loved to throw hissy fits over the use of VPN technology, accusing customers (paying for both Netflix and a VPN) of being "pirates" for refusing to adhere to regional viewing restrictions. Of course, ignored amidst all this whining (and the futile attempts to ban VPNs) was the fact that these users wouldn't be going to these lengths -- if they liked the existing services being made available to them.

Last week, Netflix surprised everybody by announcing the service was now available in 130 additional countries, bringing the grand total of available countries to 190. And while this will certainly force many broadcasters to stop whining about VPNs and start competing, the fact remains that thanks to geographical licensing restrictions, the content being made available to Netflix customers in Canada will look dramatically different to the catalog available to users in Germany. As such, there's been renewed interest in the use of VPNs to engage in what's effectively global Netflix content tourism.

Netflix has made a few token gestures over the last year to appease broadcasters, such as fleeting efforts to thwart VPNs and geo-restriction avoidance tools. Those efforts were already in play in the 60 countries Netflix operated in before this recent expansion. But speaking at CES, Netflix exec Neil Hunt basically admitted that there's not really all that much Netflix can do to stop VPN use, unless they want to waste calories on an international game of Whac-A-Mole:

"We do apply industry standard technologies to limit the use of proxies,” (Netflix chief product officer Neil) Hunt says. “Since the goal of the proxy guys is to hide the source it’s not obvious how to make that work well. It’s likely to always be a cat-and-mouse game. [We] continue to rely on blacklists of VPN exit points maintained by companies that make it their job. Once [VPN providers] are on the blacklist, it’s trivial for them to move to a new IP address and evade."

Clearly Netflix got some blowback for admitting the futility of VPN bans, however, as the company has since posted a new blog post full of non-statements that try to walk back Hunt's comments a little bit:

"Some members use proxies or “unblockers” to access titles available outside their territory. To address this, we employ the same or similar measures other firms do. This technology continues to evolve and we are evolving with it. That means in coming weeks, those using proxies and unblockers will only be able to access the service in the country where they currently are. We are confident this change won’t impact members not using proxies."

Now most of the media read this statement to mean Netflix is implementing some severe new assault on VPNs, but if you read the statement carefully all Netflix is saying is it's going to continue using the same tools they've always used. The same tools one of their key executives just got done publicly admitting don't actually work. It's simply not possible to really ban VPN use, but Netflix wants to make partners in its 190 service countries feel comfortable while it slowly but surely works toward eliminating geo-restrictive licensing entirely. Also said by Hunt at CES:

"Our ambition is to do global licensing and global originals, so that over maybe the next five, 10, 20 years, it’ll become more and more similar until it’s not different"..."We don’t buy only for Canada; we’re looking … for all territories; buying a singular territory is not very interesting any more."...“When we have global rights, there’s a significant reduction in piracy pressure on that content. If a major title goes out in the U.S. but not in Europe, it’s definitely pirated in Europe, much more than it is if it’s released simultaneously,” Mr. Hunt says.

More consistent licensing reduces piracy, but it also forces legacy companies to compete and upsets the status quo by weakening local broadcaster power, so expect 2016 to be jam-packed with oodles more hand-wringing over VPN and proxy use by companies terrified of change.

As an aside, if you were curious just how fractured Netflix content availability is by country (often because content rights are sold before Netflix can even bid), Finder this week released a pretty amazing breakdown of what's available by country, an accompanying map highlighting global availability, and a breakdown of what percentage of the U.S. catalog is available in each country.

Filed Under: geoblocking, proxies, streaming, vpns
Companies: netflix

Netflix CEO 'Loves' Netflix Password Sharing

from the customers-not-criminals dept

For a few years now, HBO has turned a blind eye to users that decide to share their passwords for HBO Go (the streaming app for existing cable providers) and HBO Now (the standalone streaming app for cord cutters). Last year HBO CEO Richard Plepler said the company keeps a close eye on the company's password sharing stats, but said the sharing isn't a huge phenomenon. Besides, as the CEO argued in an interview a few years back, the act of sharing passwords can be seen as a new form of marketing the brand, and a tool to create a new generation of addicts:

"It’s not that we’re unmindful of it, it just has no impact on the business,” HBO CEO Richard Plepler said. It is, in many ways, a “terrific marketing vehicle for the next generation of viewers,” he said, noting that it could potentially lead to more subscribers in the future. “We’re in the business of creating addicts,” he said.

Contrast that to legacy cable operators like Charter Communications, which recently declared that the sharing of login credentials was a diabolical menace. According to Charter (who'll soon be paying $79 billion to acquire Time Warner Cable and Bright House Networks), password sharing is a scourge, and HBO is a fool for turning a blind eye to such brazen "theft":

"But to (Charter CEO Tom) Rutledge, companies like HBO show a "complete lack of control and understanding in the space" by letting password sharing continue, and it's something that must be stopped. "The lack of control over the content by content companies and authentication processes has reduced the demand for video because you don’t have to pay for it,” Mr. Rutledge said on the earnings call. “That’s going on in the college market."

Of course automatically seeing everyone as a thief hiding in the shadows is a sort of rite of passage for cable and broadcast executives. And again, contrast Charter's statement to comments made at CES last week by Netflix CEO Reed Hastings, who proclaimed the company "loved" the idea of password sharing:

"We love people sharing Netflix," CEO Reed Hastings said Wednesday at the Consumer Electronics Show here in Las Vegas. "That's a positive thing, not a negative thing."...A lot of the time, he said, household sharing leads to new customers because kids subscribe on their own as they start to earn income.

Note that like HBO, Netflix's love of sharing only goes so far; the company's base $10 version restricts your account to two simultaneous streams, which bumps to four should you pay for the company's $12 plan. HBO similarly informs its users that it limits the number of concurrent streams per account for "security reasons." Still, perhaps there's a lesson buried in here somewhere about not automatically treating potential customers like diabolical criminals?

Filed Under: marketing, password sharing, reed hastings, richard plepler, streaming video
Companies: hbo, netflix

Comcast-Funded Think Tank: Broadband Usage Caps Make Netflix Streaming Better. You're Welcome.

from the sinking-to-new-logical-lows dept

As we've noted for some time, the broadband industry (and all the think tanks and politicians that work for it) have spent the last few years trying to vilify Netflix. That's primarily due to the company's support of net neutrality, but also its opposition to anti-innovative and anti-competitive broadband usage caps. These attacks usually start with the criticism that Netflix now dominates around 37% of peak downstream traffic (as if that's a bad thing), followed by some bizarre and unfounded claim that Netflix should be forced to "pay its fair share" (read: give us a cut of revenues despite us having no legitimate claim to it).

While these assaults had quieted down for a while, Daniel Lyons (not the fake Steve Jobs Daniel Lyons) and the American Enterprise Institute last week came out with a bizarre missive on broadband caps, in which Lyons tries to claim that broadband usage caps are a great way to force Netflix "to become a better corporate netizen." As noted above, Lyons starts by highlighting how Netflix consumes a huge amount of peak Internet capacity:

"Netflix has long reigned as one of America’s most significant Internet-traffic generators. Network equipment company Sandvine reports that the video-streaming company is by far the leader in peak period traffic, responsible for more than 33 percent of all fixed Internet traffic during peak hours — more than twice the share of the next-biggest competitor, YouTube. This means that at times when the Internet is most susceptible to congestion, Netflix alone is responsible for one out of every three packets sent through the network."

For clarity it should be noted that Netflix customers are responsible for this consumption. Netflix consumers who, in the United States, already pay more for bandwidth than consumers in most developing countries. Netflix in turn not only pays for bandwidth, it now pays ISPs for direct interconnection to their networks, after ISPs were accused of intentionally degrading peering points to force its hand. Everybody is paying, and paying, and paying some more -- so it doesn't matter one iota how much bandwidth Netflix is consuming -- because consumers are demanding and (probably over)paying for it.

Back in December, Netflix announced it was making some changes to the way it intelligently encodes its titles. This shift involves encoding titles differently depending on type and genre, since cartoons (with static backgrounds) technically eat less bandwidth than live action movies. The move was prompted by one thing: this month's expansion by Netflix into 130 more countries. Netflix's primary concern? Making sure that networks -- especially of the mobile variety in developing nations -- would have a more consistent and trouble-free viewing experience. It was just a smart, albeit admittedly belated shift in improving the way Netflix operates.

Apparently seeing a flimsy logical opportunity for the ages, Lyons tries to claim that Netflix was forced to improve its efficiency -- solely thanks to the wonder and glory of broadband usage caps:

Usage-based pricing forced Netflix to be more mindful of the size of its digital footprint. Because they face potential overage charges, consumers are becoming more aware of the amount of bandwidth their online activities consume. This leads edge providers such as Netflix to develop more efficient methods of delivery, in response to increased consumer sensitivity. The result is a more efficient operation that benefits everyone by freeing up network capacity — which is like broadband providers improving speeds, but without having to install new network lines."

That's an astonishing, incredible load of bullshit.

Netflix has long allowed capped users to adjust streaming quality to manage consumption, but to claim caps are to thank for these improvements is aggressively dishonest. Lyons and his friends at the AEI are funded by Comcast, the same company that's aggressively expanding utterly unnecessary usage caps on millions of consumers. Those caps have one overarching function: to raise rates on uncompetitive markets, give Comcast's own services an unfair advantage, and to protect Comcast TV revenues from Internet video.

There's clearly some worry on the part of Comcast and its think tank friends that the FCC will finally get off its ass and begin pressing Comcast on its anti-competitive abuse of usage caps, but if this is the best argument the AEI can come up with, Comcast may want to reconsider its disinformation budget for 2016.

Filed Under: broadband, broadband caps, data caps, interconnection, streaming, usage caps
Companies: aei, comcast, netflix

Patent Troll Sues Everyone For Infringing On Encryption-Related Patent By Encrypting Their Websites

from the um,-we-actually-offer-no-encryption-services-of-our-own.-sorry. dept

Underdog Texas company takes on corporate giants!

Scores of big brands – from AT&T and Yahoo! to Netflix, GoPro and Macy's – are being sued because their HTTPS websites allegedly infringe an encryption patent.

It appears in May this year CryptoPeak Solutions, based in Longview, Texas, got its hands on US Patent 6,202,150, which describes "auto-escrowable and auto-certifiable cryptosystems."

CryptoPeak reckons TLS-secured websites that use elliptic curve cryptography are infringing the patent – so it's suing owners of HTTPS websites that use ECC. Top tip: loads of websites use ECC these days to securely encrypt their traffic.

CryptoPeak, of course, offers no cryptography products. It does, however, manage a portfolio of 66 lawsuits, all filed in the Texas Eastern District Court, beginning roughly 60 days after it acquired the patent. Among the illustrious names listed as defendants are PNC Financial Services, VUDU, Netflix, State Farm, Allstate, Petco, GoPro, Mary Kay, Target, Groupon, Williams-Sonoma, Etsy, Priceline… well, the list goes on and on and on.

All of these companies produce goods and services. CryptoPeak does not. The only thing it produces are lawsuits. The patent it's using in its litigation doesn't appear to actually cover the allegedly infringing activity it's suing over.

Perhaps crucially, [the patent] describes a means for "generating public keys" and "publishing public keys", and it's certainly true that ECC does involve generating public keys and using them.

But the patent is focused on "a key recovery agent to recover the user's private key or information encrypted under said user's corresponding public key" – which is really not the point of ECC.

Netflix, which has already moved to dismiss the suit against it, doesn't concern itself too much with the patent's supposed function. Instead, it argues the patent (along with the numerous lawsuits) should be invalidated/tossed because of other wording used in the patent paperwork itself.

The invalidity of the claims asserted here is cut and dry. The Asserted Claims recite “a method and apparatus.” Thus, a practitioner cannot know the scope of the Asserted Claims from reading them because they explicitly claim “separate statutory classes of invention,” an act expressly forbidden by the law. For this reason alone, these claims are invalid on their face, and the Court should declare so at this stage.

Netflix then points out the "method and apparatus" wording appears in multiple claims.


All of which should serve to kill the lawsuit and, possibly the patent, no matter how much the troll protests.

The defect in these claims is so glaring that CryptoPeak’s only choice is to request that the Court overlook the express words of the claims, construe the claims to read out certain language, or even correct the claims. CryptoPeak has done just that in its Amended Complaint, alleging that “[n]othwithstanding that [the claims] generically recite the existence of ‘apparatus’ in their preambles, each of the . . . Asserted Claims is a method claim . . . .” (Dkt. No. 21 at 4 (emphasis added).)

This request is improper and should be rejected. The Court must read the claims as written, “not as the patentees wish they [ ] were written.”

Seems like a solid argument, but CryptoPeak didn't file in this particular court just because it coincidentally happened to have rented a mailbox and an empty office in Longview, Texas shortly before filing the lawsuits. It filed in this court because magical things often happen for patent trolls -- wholly unrelated to the validity of their claims and their affected Texan accents. If this wasn't the case, then this particular district wouldn't be the IP shitmagnet that it is. If CryptoPeak can nail down a few settlements and licensing agreements, it makes the hassle and expense of serial filing worthwhile. And isn't that why our patent system was implemented in the first place?

Filed Under: encryption, https, patent troll, patents
Companies: at&t, cryptopeak solutions, etsy, gopro, groupon, macy's, netflix, petco, priceline, target, yahoo

TV Industry Starts Running Fewer Ads To Combat Netflix, Cord Cutting

from the evolving-dinosaurs dept

Historically, the cable and broadcast industry has responded to Internet video competition in the only way a mammoth legacy industry knows how: denial, dirty tricks, price hikes, more dirty tricks, and more denial. And instead of giving customers what they want (lower prices, ad skipping technology, more flexibility in programming packages) they've arguably often made things worse -- like stuffing more ads into every viewing hour.

Nielsen data suggests that ad time per hour on has gone up from 14:27 to 15:38 minutes per hour on cable, and 13:25 to 14:15 minutes per hour on broadcast -- since 2009. When all the ads wouldn't fit, they'd just edit or speed up the programs, or utilize more product placement. All while raising rates on consumers at four times the pace of inflation. But there's a small indication that the cable and broadcast industry may have finally started realizing they can no longer get away with this in the Netflix age.

With ratings in free fall and cord cutting (and "cord never") numbers giving some executives indigestion, Discovery and Fox recently acknowledged they've been running fewer ads during their prime time programming. Time Warner last week also declared it had seen the light, acknowledging it was going to lessen the ad load specifically on its networks aimed at Millennials:

"We know one of the benefits of an ecosystem like Netflix is its lack of advertising,” Howard Shimmel, chief research officer at Time Warner’s Turner Broadcasting, said in an interview. “Consumers are being trained there are places they can go to avoid ads."

Even Viacom, which had been leading the charge to stuff more ads in each hour, appears to have suddenly realized that something has to change:

"Viacom CEO Philippe Dauman talked about cutting ad loads during an investor conference in September. Viacom has been working on non-Nielsen metrics to sell advertising as more of its younger viewers watch on non-traditional platforms..."With those kicking in we’ll be in position—we’ve been talking to a lot of advertisers about it, which they like—to reduce ad load in primetime across our networks, which will improve the consumer experience and drive pricing," Dauman said.

Granted we're not out of the deep, dark denial woods quite yet. These companies may be cutting ad load but they're just charging more for the same ads, hoping they can rebalance the books and ignore the Internet video revolution waiting in the wings. Many other execs still see cord cutting as a bit of a fad, one that will reverse itself once Millennials procreate. The reality is that you'll know the cable and broadcast industry is finally taking Internet video seriously when they do the one thing most of the industry's execs are utterly terrified of: competing on price.

Filed Under: ads, cord cutting, tv
Companies: discovery, netflix, news corp., viacom