Level3 Proves That Verizon Is Absolutely To Blame For Netflix Congestion... Using Verizon's Own Blog Post

from the ouch dept

As you know, despite Netflix having already agreed to pay Verizon's shake down fee to avoid interconnection congestion for its streaming, Netflix and Verizon are fighting a very public fight about who's to "blame" for the network congestion. Netflix took a public shot at Verizon by publicly highlighting Verizon's congested network to users, leading Verizon to send a cease-and-desist letter, claiming it was misleading. As we noted, there's no doubt that it's actually Verizon at fault, because it's not delivering exactly what it sold customers (and we wonder why the FTC is still not getting involved yet). If Verizon's network is getting congested, that's on Verizon to fix, since it sold its users a promise that they could reach anywhere on the internet, including Netflix.

Verizon tried to spin the story back in its favor last week, with a blog post about "the congestion myth," in which it claimed that the real problem was how Netflix chose to route its traffic to Verizon. It presented the following nifty chart, claiming that there was no congestion at all on Verizon's network, and saying that it was all about how Netflix was choosing to deliver its traffic to Verizon's network: As you can see in the "red" arrow, it's showing that there's 100% utilization at the interconnection link. And Verizon claims this is all on Netflix. Here's Verizon's explanation:

One might wonder why Netflix and its transit providers were the only ones that ran into congestion issues. What it boils down to is this: these other transit and content providers took steps to ensure that there was adequate capacity for their traffic to enter our network. In some cases, these are settlement-free peering arrangements, where the relative traffic flows between an IP network provider and us remain roughly equal, and both parties invest in sufficient facilities to match these roughly equal flows. That is the traditional basis for such deals. In other cases there may be traffic imbalances, but the networks or content providers have entered into paid arrangements with us to ensure connections and capacity to meet their needs for their out-of-balance traffic.

Some reporters took this at face value, but it never made any sense at all. The chart above pretty clearly shows that the congestion point is actually Verizon's border router. And if it just made a basic upgrade to accept the traffic that it has promised to consumers, there would be no problem at all.

Level3 has now jumped into this debate as well, with even more data showing that Verizon is the real culprit here. Level3 is carrying a bunch of that Netflix traffic, and notes that it has more than enough bandwidth to carry it. It says the only problem is Verizon refusing to take 5 minutes to upgrade its system:

Verizon has confirmed that everything between that router in their network and their subscribers is uncongested – in fact has plenty of capacity sitting there waiting to be used. Above, I confirmed exactly the same thing for the Level 3 network. So in fact, we could fix this congestion in about five minutes simply by connecting up more 10Gbps ports on those routers. Simple. Something we’ve been asking Verizon to do for many, many months, and something other providers regularly do in similar circumstances. But Verizon has refused. So Verizon, not Level 3 or Netflix, causes the congestion. Why is that? Maybe they can’t afford a new port card because they’ve run out – even though these cards are very cheap, just a few thousand dollars for each 10 Gbps card which could support 5,000 streams or more. If that’s the case, we’ll buy one for them. Maybe they can’t afford the small piece of cable between our two ports. If that’s the case, we’ll provide it. Heck, we’ll even install it.

Level3 has provided a (not quite as nicely designed) image to zoom in on the border router situation, showing that it has plenty of capacity ready -- all it needs is for Verizon to let it connect more ports: Again, this is what plenty of people have been saying since the beginning of this interconnection fight. Verizon, Comcast and AT&T have deliberately made the decision not to make rather basic and inexpensive upgrades to their interconnection points that would solve the congestion problems with Netflix. In doing so, they are the ones creating the bottleneck and congestion -- and effectively using it to shake down Netflix, getting them to pay extra for the bandwidth that the broadband providers' customers have already paid for.

Looking at this, it once again becomes clear that it's Verizon, AT&T and Comcast that have deliberately caused this congestion, using their positions as dominant players with monopoly control over the last mile to force Netflix to pay them extra. As Level3 notes, it takes two parties to take the "trivial" steps to remove the congestion, and it's Verizon that's the party who isn't cooperating:

All of the networks have ample capacity and congestion only occurs in a small number of locations, locations where networks interconnect with some last mile ISPs like Verizon. The cost of removing that congestion is absolutely trivial. It takes two parties to remove congestion at an interconnect point. I can confirm that Level 3 is not the party refusing to add that capacity. In fact, Level 3 has asked Verizon for a long time to add interconnection capacity and to deliver the traffic its customers are requesting from our customers, but Verizon refuses.

As we've discussed, Verizon, Comcast and AT&T know exactly what they're doing here. People hadn't been so concerned with interconnection disputes in the past, because they didn't think the big broadband players would be so crass and so anti-consumer to purposely let interconnection points clog up. But, those three companies have such control over the market at this point that they are able to do that and can effectively shake down internet companies to get them to double pay for the bandwidth that subscribers are already paying for. Today it's Netflix, but soon it's likely to be lots of other companies as well. That's why, in our own comments to the FCC, we noted that the interconnection fights need to be a part of the open internet discussion.

Filed Under: border routers, congestion, interconnection, streaming
Companies: level3, netflix, verizon

Aereo Fallout Begins: Fox Uses Ruling To Attack Dish's Mobile Streaming Service

from the because-welcome-to-this-new-mess dept

We've been saying that the Aereo ruling is going to create a litigation headache for a number of companies... and here we go. You may recall that a bunch of TV broadcasters have sued Dish over its attempts to provide innovative features to consumers, such as its Dish AutoHopper and its Dish Anywhere streaming offering. So far, those lawsuits have gone nowhere and fast. But Fox sees renewed life in its effort to shut down innovation thanks to the Supreme Court's unfortunate "looks like a duck" test.

Within hours of Wednesday's ruling, Fox had run to the 9th Circuit appeals court with the news. The 9th Circuit had previously rejected Fox's attempt to shut down the Dish technology, but Aereo has renewed its hopes of killing some innovation:

Fox's lawyers believe the Aereo ruling strengthens their case against Dish. In a letter to the court Richard Stone, partner at Jenner & Block, wrote that the supreme court had ruled Aereo's service constitutes an "unauthorized public performance of Fox's copyrighted works."

"Dish, which engages in virtually identical conduct when it streams Fox’s programming to Dish subscribers over the internet – albeit also in violation of an express contractual prohibition – has repeatedly raised the same defenses as Aereo which have now been rejected by the supreme court," he wrote.

Stone highlighted that the court had specifically rejected Aereo's assertion that it is "merely and equipment provider" and that Aereo's subscribers were the ones transmitting content.

Get ready, because Aereo is going to get cited a lot by the legacy entertainment industry as they quickly seek to destroy innovation.

Filed Under: autohopper, copyright, dish anywhere, dvr, looks like a duck, remote viewing, streaming
Companies: aereo, dish, fox

Yes, Verizon Is At Fault In Netflix Dispute; It's Not Delivering What It Sold Customers

from the a-dose-of-reality dept

We wrote about the latest Netflix/Verizon dispute over who's to blame for poor quality movie streaming. Netflix has chosen to pin the blame on the ISPs when there's network congestion, while Verizon angrily hit back at this "PR stunt," claiming that it was actually Netflix's fault for not doing a better job routing its traffic. Except... that's not true. As we've been pointing out for the better part of a decade, this is all about the broadband companies trying to double charge. Tim Lee, over at Vox, summarizes the point nicely:

Verizon's customers have paid Verizon for the service of delivering content to them. But rather than simply performing the service Verizon's customers have paid it to perform, Verizon sees an opportunity to get paid twice: in addition to charging its own customers for connectivity, Verizon hopes to also charge Netflix to deliver its content to those customers.

Verizon is effectively using its own customers' poor experience as leverage. Verizon has been threatening Netflix that if they don't pay up, Netflix customers (who are also Verizon customers) will get frustrated and cancel their Netflix service. Of course, that threat is a lot more powerful because most customers don't have many alternatives to Verizon service.

And yes, I know that some big broadband defenders will immediately trot out the usual defense: that Verizon sold its network in a way that it never actually expected subscribers to use -- but it's difficult to see how that's everyone else's fault. If anything, it raises some questions about whether or not the FTC might want to step in and look at whether or not Verizon, AT&T and Comcast totally misrepresented what they were selling consumers.

As for the bullshit claim that Netflix is to blame because it sends Verizon more traffic and thus the "traffic ratios are unbalanced," well, Lee points out that this is actually Verizon's fault as well.

But this argument doesn't make sense. Verizon customers aren't just paying Verizon to send traffic to Netflix, they're also paying Verizon to deliver Netflix (and other) traffic to them. And there's no reason to think that carrying traffic from Netflix to Verizon customers is more expensive than carrying traffic in the other direction.

Indeed, there's a simple reason that Verizon's network receives more traffic than it transmits: that's how Verizon set it up. All of Verizon's standard FiOS packages provide dramatically more bandwidth for downloading than uploading. The entry-level service, for example, is 15 Mbps downstream and 5 Mbps upstream. The fastest package is even more lopsided: 500 Mbps downstream and 100 Mbps upstream. If Verizon builds a network that's optimized for downloading, it can't complain that its customers use it to download stuff.

And, of course, Verizon can squawk all it wants about this, but it's not going to change the fact that it's the problem here. Yes, Netflix delivers a lot of data. But if Verizon can't handle it, it shouldn't have sold it to consumers.

Filed Under: broadband, disputes, double charging, interconnection, net neutrality, peering, streaming
Companies: netflix, verizon

Verizon Sends Netflix A Cease & Desist, Saying It Can't Blame Verizon For Clogged Networks

from the really,-now? dept

So, yesterday, some of the tech blogosphere blew up over the fact that Netflix had started blaming Verizon for network congestion: Netflix claimed it had actually been testing this for a few weeks now, and others have seen it on AT&T networks as well. Verizon was, to put it mildly, not happy about all of this. It quickly told reporters that the whole thing was a "PR stunt" and pushed out an angry blog post, saying that it was all Netflix's fault for the way it routed traffic to Verizon's network. Notably, just about a month ago, Netflix had agreed to an interconnection deal, similar to the one that Netflix famously did with Comcast, but it's possible that the new ports aren't fully operational yet.

Either way, I was going to ignore this latest round of little stupid spats that have been going back and forth -- except that now it appears that Verizon has taken it up a level and actually issued a cease and desist to Netflix sayng it should no longer blame Verizon when the network is clogged. I'm not sure what actual legal basis Verizon thinks it has to do this, and wonder if Netflix will just cave in and stop with the messages. But, it certainly would create quite the interesting lawsuit if Verizon decided to go to court about this. Update: Netflix has indicated that it won't stop.

Either way, it's pretty clear that even once Netflix has signed an interconnection agreement with them, these ISP's are still not at all happy about the situation.

Update: Added an embed of the actual letter below.

Filed Under: arguments, broadband, cease and desist, interconnection, net neutrality, streaming, threats
Companies: comcast, netflix, verizon

RESPECT Act Should Be HYPOCRISY Act After How Often Labels Screwed Over Artists

from the respect? dept

Yesterday, the music labels, under the guise of RIAA spinoff SoundExchange, along with Congressional Reps. George Holding and John Conyers, announced some new legislation and a coordinated PR campaign for what they're calling "Project72." The official name of the bill is the "Respecting Senior Performers as Essential Cultural Treasures Act" or the RESPECT Act. There is so much hypocrisy and ridiculousness here that it's difficult to know where to start. However, in short, the labels fought hard to keep the situation the way it is today, and a very large number of the musicians the RIAA rolled out in "support" of this new law -- claiming they just want to get paid by music streaming services -- are musicians who got totally screwed over by RIAA labels in the past. How about a little "respect"?

As we've been reporting, there's been an ongoing legal fight over how to handle pre-1972 sound recordings, because they are technically not covered under federal copyright law. This is because, back in 1909, Congress explicitly excluded sound recordings from the Copyright Act, noting that they didn't believe the Constitution allowed copyright to cover sound recordings (think about that for a second...). A variety of state copyright laws (or the equivalent) popped up to try to fill in the gap. With the 1976 Copyright Act, however, sound records made in 1972 and after were covered, leaving all recordings from pre-1972 in a bit of legal limbo. The copyright office has been debating what to do about this for years. So far, it's actually created something of a cultural disaster, because works that should be in the public domain won't be in the public domain for the rest of our lifetimes.

Meanwhile, many have suggested that a perfectly legitimate way of dealing with this would be to just retroactively say that all pre-1972 sound recordings should be brought under federal copyright law. However, the RIAA itself has fought very hard against this. Why? There are a few reasons, but here are a few big ones: (1) Since the copyright lasts so much longer under state laws, they get to keep the copyright longer. (2) They love to use this issue to claim the DMCA's safe harbors don't apply to any user-generated content site that includes pre-1972 sound recordings. It's a backdoor into gutting the DMCA's safe harbors. (3) Unlike federal copyright law, post-1978, there are no termination rights, allowing the original creator to take back their copyrights.

So it seemed particularly hypocritical last month to see SoundExchange suddenly go all crazy around the claim that music streaming sites don't pay royalties on pre-1972 works. Of course, this is, in part, because of the RIAA's own efforts to keep pre-1972 works from being put under federal copyright law. The various state laws don't include a public performance right, and thus there are no necessary licenses for the streaming of such works -- and that's been widely accepted as the law for years. Until now. If the RIAA wanted to change that, it should have helped move those works under federal copyright law, but it has fought hard against it.

Instead, we get "The RESPECT Act" which would effectively only extend performance rights to pre-1972 sound recordings, while leaving everything else about those works uncovered by federal copyright law. In other words, the RIAA (via SoundExchange) wants to only put the parts of copyright law it likes on pre-1972 sound recordings, while keeping the rest understate laws. And they claim this is about RESPECT?

But here's where it gets really, really ridiculous. To "support" this new legislation from Holding and Conyers, which they're calling "The RESPECT Act," and which they claim is all about getting musicians paid... they trotted out a bunch of famous musicians who support this law.

Project72 kicks off with an open letter, signed by more than 70 recording artists, calling on digital radio to treat all sound recordings equally and to "pay for all the music they play." Artists and bands urging these services to "do right by legacy artists" include: The Allman Brothers Band, The Beach Boys, Roseanne Cash, Melissa Etheridge, Al Green, B.B. King, The Moody Blues, Cyndi Lauper, Martha Reeves, members of Steely Dan, The Supremes, The Temptations, Three Dog Night, and many more.

Note that they say "pay for all the music they play." They do not say to "pay the artists for all the music they play." And that's because SoundExchange and the record labels have a rather long history of not actually paying the artists. Respect!

Hell, you'd think that the RIAA/SoundExchange would have the common sense to check to see whether or not any of the big name stars they brought out had a history of being screwed over and simply not paid by their RIAA labels before attaching them to this campaign. But it appears they did not. Looking through the list of artists who are part of the campaign (beyond just the headliners listed above), we see... quite a few disputes involving the RIAA not paying those artists. All of the following artists signed onto this campaign, despite the fact that RIAA-associated labels have a long history of screwing them over.

• The Allman Brothers have had to sue both Universal Music and Sony Music for unpaid iTunes royalties.
• The Temptations sued Universal for not paying iTunes royalties properly.
• The Beatles sued EMI over unpaid royalties.
• Martha Reeves sued Motown for unpaid royalties
• The widow of "Dave" in the famous Sam & Dave duo had to sue Atlantic Records for unpaid royalties in 2001.
• Gene Chandler's label Vee-Jay, on which he recorded "Duke of Earl," was infamous for not paying royalties and actually went bankrupt when threatened with lawsuits for unpaid royalties.
• Mark Farner, of Grand Funk Railroad, was paid $350 a week for the first two years as an "employee" and, after a dispute with the band's "manager," had to give up all the rights to the music anyway (meaning he wouldn't get paid for those songs anyway).
• Roger McGuinn, from the Byrds, has told Congress before that he never received royalties (beyond a "modest advance") for the 15 albums he recorded with the band, suggesting that the Byrds are still considered "unrecouped" and any money that might get paid out would just go to his label rather than him anyway.
• An early member of Steely Dan has been suing claiming that he hasn't received any SoundExchange royalties he's owed.
• Yoko Ono sued EMI over unpaid John Lennon royalties.

And that's just a sampling from the list (didn't have time to go through everyone, so just picked more recognizable names). While yes, they're now arguing for "royalties" from Pandora and from Sirius XM, they might want to look more closely at who they've partnered with to seek those royalties. After all, if the RIAA hadn't blocked efforts to federalize those pre-1972 recordings, this wouldn't even be an issue. And, more to the point, since the labels own the copyrights on most of these songs anyway, the royalties are going to go into their coffers, and as the list above shows, the RIAA labels seem to have nearly perfected the process of not paying artists.

If Reps. Holding and Conyers really wanted to "respect" such artists, perhaps it would focus on encouraging them to actually avoid the record labels who have worked so hard to not pay them in the past.

Filed Under: allman brothers, beatles, copyright, gene chandler, george holding, grand funk railroad, john conyers, mark farner, martha reeves, pre-1972, pre-1972 sound recordings, respect act, roger mcguinn, royalties, sam & dave, steely dan, streaming, the byrds
Companies: emi, riaa, sony music, soundexchange, universal music

Google Fiber: You Know How Comcast Is Making Netflix Pay Extra? We Don't Do That Kind Of Crap

from the good-for-them dept

The folks behind Google Fiber have fired a not-so-subtle shot at Comcast and Verizon for their recent efforts to make companies like Netflix pay extra. As we've noted, the big last mile access broadband access providers have realized that they can effectively get companies to pay twice by clogging certain points in the network. Even more nefarious, they're able to do this without violating a narrow view of "net neutrality" because net neutrality is focused on the last mile, rather than interconnection and peering. It's a really scammy process, which is part of those big broadband providers' attempts to extract monopoly rents out of their control over the last mile.

Google Fiber has stayed out of this debate for a while, but just fired a clear shot in the fight, with a blog post that never mentions Comcast, but more or less screams: You know that bullshit that Comcast and Verizon are pulling? We don't do that. Instead, they note two important things: (1) contrary to the claims of Comcast, online video traffic is in no way overwhelming the network, and (2) it's easy to help upgrade the setup for Netflix and others for free:

We have also worked with services like Netflix so that they can ‘colocate’ their equipment in our Fiber facilities. What does that mean for you? Usually, when you go to Netflix and click on the video that you want to watch, your request needs to travel to and from the closest Netflix data center, which might be a roundtrip of hundreds or thousands of miles. Instead, Netflix has placed their own servers within our facilities (in the same place where we keep our own video-on-demand content). Because the servers are closer to where you live, your content will get to you faster and should be a higher quality.

We give companies like Netflix and Akamai free access to space and power in our facilities and they provide their own content servers. We don’t make money from peering or colocation; since people usually only stream one video at a time, video traffic doesn’t bog down or change the way we manage our network in any meaningful way — so why not help enable it?

But we also don’t charge because it’s really a win-win-win situation. It’s good for content providers because they can deliver really high-quality streaming video to their customers. For example, because Netflix colocated their servers along our network, their customers can access full 1080p HD and, for those who own a 4K TV, Netflix in Ultra HD 4K. It’s good for us because it saves us money (it’s easier to transport video traffic from a local server than it is to transport it thousands of miles). But most importantly, we do this because it gives Fiber users the fastest, most direct route to their content. That way, you can access your favorite shows faster. All-in-all, these arrangements help you experience the best access to content on the Internet — which is the whole point of getting Fiber to begin with!

So, what's Comcast and Verizon's excuse?

Filed Under: buffering, google fiber, interconnection, peering, streaming
Companies: comcast, google, netflix, verizon

Netflix Exploring Peer-To-Peer Delivery Just As Spotify Gets Ready To Kill Its Peer-To-Peer Streaming

from the moving-in-opposite-directions dept

From the very beginning of peer-to-peer content delivery, people have pointed out the many advantages it provides to just offering content from a single central source. It's more resistant to overloading, can more efficiently route traffic, makes better use of bandwidth and a variety of other useful things as well. So, it was a bit of a surprise a few weeks ago to hear that Spotify -- whose service was built from the beginning using peer-to-peer technology -- was actually moving away from that model and towards a centralized source run entirely by the company. Even more interesting is that the largest example of a content service that had always focused on a centralized source, Netflix, is now looking to go in the other direction, and is exploring peer-to-peer delivery of its video content.

This might just be a "the grass is always greener..." kind of situation, but it does seem inherently odd that just as one of the largest peer-to-peer setups is moving away from that structure, an even larger player is potentially moving towards it. Of course, part of the issue may have a lot to do with Netflix's ongoing fight with broadband providers (mainly Comcast) who want them to pay extra. Netflix recently got into a bit of a blogging battle with Comcast in showing why Comcast is trying to charge Netflix for access to its users, noting that this is entirely different than paying transit networks, which charge for transit, not access. Comcast replied lamely that this is really about Netflix trying to get all internet users to pay for its costs of doing business.

First of all, Comcast is clearly wrong about that. What Comcast is being dishonest (shocking, I know...) about is that even though it charges users for a broadband connection, it doesn't expect them to actually use that connection so much. Comcast's problem with Netflix is that it actually gets users to use the broadband line they bought. So, rather than admit that Comcast's business model has always been based on lying to consumers in telling them they bought bandwidth it never really wanted to sell them, Comcast is trying to get Netflix to rebuy the bandwidth consumers already bought in order to access those consumers.

Given that, it's no surprise Netflix has a new interest in P2P technology -- because part of the basis of P2P is making use of the underutilized bandwidth that consumers paid for, but which they never use. So, in effect, Netflix's move to P2P is an attempt to hit back at Comcast, by pushing consumers to actually use more of the bandwith they'd paid for and never used, and do it in a way that makes it look less like it's all coming directly from Netflix.

Spotify, on the other hand, while it uses a fair amount of bandwidth, doesn't use nearly as much as Netflix, and thus sees some benefits in better controlling the overall connection experience, by serving up all the content directly. Though, I would imagine it would be smart on Spotify's part not to throw away all that P2P code. If Spotify continues to grow, it won't be long until it faces a "Netflix/Comcast" moment of its own -- and having that P2P setup in its back pocket can only help in those negotiations.

Filed Under: broadband, broadcasting, content delivery, interconnection, peer to peer, peering, streaming, trafffic
Companies: comcast, netflix, spotify

WWE Attorney Tries To Sneak Address Of Wrestling Streaming Site By Offering A Gift Bag

from the foreign-object-in-the-ring dept

Professional wrestling league, the WWE, is truly a lesson in paradoxes. A theatrical production presented as an athletic competition sets the stage for a business that at times can't quite seem to figure out exactly how it wants to behave. On the one hand, you have their plan to embrace a streaming product that leaves much of the rest of the "sporting" world to shame. On the other hand, WWE executives have been known to protect their intellectual property on a level bordering insanity.

In this latest story, executives for WWE seem to be channeling one of their in-the-ring evil personas, in which they pretend to offer up an apology to a streaming site operator all in an attempt to sneak his identity and contact information from him. It all starts with battling a website designed to bring wrestling fans the streaming they wanted (note: this was before WWE offered its own streaming service):

During March 2013, Facebook said that WWE Intellectual Property Director Matthew Winterroth was behind the closure of a page operated by Wrestling-Network, a site offering links to WWE streams and shows. Wrestling-Network operator ‘BeBe’ was told by the social network that he would need to contact the lawyer directly to solve the dispute. BeBe decided to quit Facebook and moved to Twitter instead, but by the summer WWE had raised its head again, this time after PayPal disabled an account used for the site’s finances. BeBe says that in October WWE sent a takedown notice to Cloudflare, who handed over the details of the site’s actual host. For a few months things went calm, but last week all that changed. PayPal closed the site’s new account which had been opened by a third-party, and Facebook shutdown Wrestling-Network’s new page and BeBe’s personal page while they were at it.

It's a story that feels as old as the bible these days. Guy runs sites pointing to links of illegitimate streams, content producer works to take the site down, cat-and-mouse game commences. Now, we could have a long discussion about how links aren't themselves infringement, about how WWE could (and it appears eventually did) offer a competing legitimate service, and all the rest. This isn't that post, however, because it was around this time that things got a bit strange. BeBe did as he was asked and reached out to the WWE to resolve the issue. In his communique, he offered up only his handle and his email address.

Winterroth responded to BeBe, suggesting the takedown of his site may have been a mistake. It seems unlikely Winterroth was being honest about this, since he was the one named in the takedowns. Stranger, a follow-up email from Winterroth requested BeBe's real name and address, promising a WWE giftbag and an apology for taking down the sites. BeBe wasn't taking.

“I mean, I heard a long time ago about a case where in order to arrest them on US territory, some guys were attracted to the USA by undercover FBI agents who promised them money and girls, but a gift bag from WWE? Really? He could at least given me some WrestleMania tickets.”

BeBe says he politely declined the offer.

Winterroth's response had, shall we say, a slightly different tone. He tells BeBe he's tracked him down to Romania and promises to send the blackshirts over for a visit.

“Should you not shut down the website and agree not to infringe WWE intellectual property in the future in an immediate fashion, WWE will continue to work with our counsel in Romania, as well as the relevant legal authorities, including the Ministry of Internal Affairs/Bucharest City Police and Romanian National Audiovisual Council on our ongoing criminal complaint against you.”

What followed were demands for BeBe to hand over his domain but with tempers beginning to fray, that seemed unlikely.

From there, the exchanges devolved, on both sides, into threats from the WWE and BeBe's sophomoric attempts to remind Winterroth that Romania is actually a country outside of the United States, where US copyright law is as applicable as federal payroll taxes. Nobody comes out clean in the exchange, with both sides behaving like children.

Which is the entire point: if I can't tell the difference between a guy running a streaming-links site and the counsel for a multi-milliion dollar entertainment business, we have a problem. Also, false apologies and underhanded attempts to sneak contact information out of a guy who is just running a site linking to what might be legitimate targets for corporate counsel make everyone look oily. Finally, this seems like an awful lot of energy to spend on this situation, particularly when the release of a real damned streaming product to compete with the "pirates" was just around the corner. So, for all that work, Winterroth likely gets nothing other than a single link site taken down, while the folks putting together the streaming site actually work to make the company more money. It makes one wonder which side is getting the higher pay in this equation.

Filed Under: gift bag, streaming
Companies: wwe

The Cost Of Permission Culture: Or Why Netflix Streaming Library Sucks Compared To Its DVD Library

from the first-sale-is-important dept

Why can't movie-streaming sites deliver the selection of movies that customers obviously want? This was the question posed by a recent New York Times column, comparing undersupplied services like Netflix with unauthorized platforms like Popcorn Time. The answer, the Times explains, is windowing—the industry practice of selling exclusivity periods to certain markets and platforms, with the result of staggered launches.

But the Times fails to ask a more fundamental question: why do streaming sites have to listen to Hollywood's windowing demands in the first place? After all, while it's clear why the studios like windowing—they can sell the same rights over and over once the promised exclusivity periods expire—it doesn't seem like a very good deal for users. Those users get access to a smaller selection, higher prices, and fewer choices between platforms and services. It should be astonishing that a company that once had to maintain and transport a staggering inventory of fragile plastic discs is able to offer less when its marginal cost dropped to near zero.

The problem is that, unlike earlier movie-rental options, streaming rights fall fundamentally within a permission culture. Netflix is a great illustration of what's gone wrong here. It's gone from having a nearly unrivaled catalog of films available to rent to being the butt of Onion jokes. What happened: It shifted from a system where nobody had a veto power over its operations, to one where it had to get permission and make deals with Hollywood. Sometimes it's difficult to find the concrete costs of living in a permission culture, but the decline of Netflix's selection is an important cautionary tale.

It's especially clear when you look at how Netflix upended the movie rental market in the first place. In one way, it suffered from a major competitive disadvantage: competitors like Blockbuster had locations near people's houses. As long as those stores had the movie you wanted, you could be watching within hours—not days—of deciding on a title.

But Netflix was able to experiment with different price points and subscription models and, crucially, it could try those without first convincing any incumbents. Both Blockbuster and Netflix's DVD-by-mail service relied on the first sale doctrine, meaning they can buy physical copies of movies, and then resell or rent at any price they like. No royalties, no licenses, no contracts—with physical media, once a rental company has bought the copy, the copyright holder is basically out of the picture.

You can see how this is great for users. Companies can experiment to find the things that people like best, and have the power to make decisions based on their users' needs and wants. Movie studios still got paid—these rental companies were buying lots and lots of copies, after all—but couldn't exert control over the rental businesses, which could then compete on their merits.

Rightsholders hate not having this control. So the first sale doctrine gets attacked over and over. From Nintendo's suing Blockbuster in the 80s to Universal's "revenue sharing agreement" with Redbox, and through to more recent cases like Kirtsaeng v. Wiley in the Supreme Court, rightsholders have tried to restrict the first sale doctrine in physical media. And when it comes to digital media, consumers have even more of an uphill battle.

When the ranking member of the House Subcommittee on intellectual property is calling the principle of "you bought it, you own it" an extreme view, there's something seriously wrong here. Furthermore, the Netflix example shows that the problem isn't confined to the books, movies, records, and games that we own; it limits the kinds of services that can ever be created.

With a commercial product like Netflix, we can feel those costs today. But more troubling are the costs we will feel tomorrow, in a decade or a century from now, if we make a transition to digital media without keeping the first sale doctrine intact. Copyright has already cost us crucial elements of our cinematic and literary history. Those costs will compound if librarians, archivists, and enthusiasts aren't allowed to care for their own copies.

As Matt Schruers over at the DisCo Project notes, studio practices have ensured that no option so far can be convenient, comprehensive, and lawful. Netflix Instant is a great service for what it is able to offer, but in a permission culture it is broken from the start.

Filed Under: copyright, first sale, permission culture, streaming
Companies: netflix

Baseball Is Back! Too Bad I Still Can't Watch My Local Team On My MLB.TV Subscription...

from the root,-root-root-for-someone-out-of-market dept

Can you smell it yet? The freshly cut grass, the muffled sound of thousands of fans, the wonderous gasps of young people? Baseball is back. I'm generally an avid fan of professional sports and, as I've written about before, a strong promoter of the idea that the pro sports leagues I love so much could benefit greatly from a wider, more open embrace for streaming their games online. Particularly for leagues on the lower end of the popularity and revenue spectrums, I would think that building a wider audience through internet streaming would be a boon to otherwise mediocre broadcasting partnerships. The NHL in particular is known to have absolutely brutal broadcast contracts that aren't supporting teams as well as they could if the league were to attempt to multiply their viewership through streaming.

But with Major League Baseball, it's a whole different animal. Teams in Major League Baseball are insanely profitable, in largest part because of the broadcasting revenue. With that in mind, it might seem silly to suggest that MLB should be looking at ways to free up their streaming product. But that's wrong and here's why.

First, let's start with a little background and some compliments. Nobody in pro sports leagues does streaming as well as MLB in terms of quality and quantity. For $130/year, you get almost all the games for the entire season in full HD, with options for the radio or television broadcasts offered by either of the teams playing. The stream is reliable and of good quality, with a pop-out media player that's simple. For the games they stream, it works beautifully.

You've probably already guessed the problem, haven't you? It's region locked, with the arbitrary borders of a team's fan-base blacked out from their team's streams, both for home games and away games. The idea, of course, is that MLB doesn't want to offend their local broadcast partners by offering their broadcast over streaming as a charged service. Their thought is essentially that the broadcast is TV's product and local advertising is what pays the television stations, who in turn pay MLB for the rights to the games. Let's turn this on its head, though, and see the insane kind of money MLB could make if they stopped seeing themselves as only being in the baseball business and also offered up their established streaming infrastructure to their broadcasting partners.

MLB, today, could go to TV stations, cable or otherwise, and offer up their robust streaming platform. MLB would make its money charging more for broadcast rights under that kind of agreement. TV stations in turn could claim a higher viewership than they have today through TV only, allowing them to generate increased revenue in advertising sales and rates. Keep in mind that MLB.TV is using those station broadcasts anyway (for instance, the MLB.TV Chicago Cubs stream is just the WGN/CSN broadcast streamed over MLB.COM). Between internet streaming and mobile devices, viewership numbers would skyrocket. I say this because of how often we're told about the horrific danger of all the sports streaming sites already out there offering the exact thing MLB.TV could be getting paid for. In other words, anyone with an internet connection can already do all this, while MLB.TV could offer the same thing as part of their package with infrastructure they already have in place.

In summary, baseball could today, without having to invest in any infrastructure, work with broadcast partners to free up streaming to local fans who can already get those streams through illegitimate services. It would benefit the league, the broadcast partners, the advertisers, and the fans. There is literally no loser in this equation. All it would take is some forward-thinking folks in the league and TV to get over their protectionist traditions and make it happen.

In the meantime, my MLB.TV subscription means I can't watch my team play for no logical reason.

Filed Under: baseball, blackouts, local fans, sports, streaming, streaming media
Companies: mlb, mlb advanced media