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

Aereo Wins Round One Against Broadcasters; Judge Rejects Injunction & Allows Service To Live

from the how-do-you-define-your-antenna dept

We've been covering the ridiculous legal fight over Aereo for a few months now. If you don't remember, Aereo is a company that offers -- for a fee -- to let people watch over-the-air broadcast TV (not cable, so just the small number of broadcast stations) online. Basically, what they do is set up antennas in a building in Brooklyn -- with one antenna per customer -- and then connect that antenna to the internet so the person can watch. The TV broadcasters flipped out and sued.

As we've noted, in essence, this is another lawsuit that asks the question: do the copyright rules change depending on the length of your cable. That is, we know that it's legal to put up an antenna yourself and watch what you get. That's how broadcast TV works. We also know that it's almost certainly legal (it hasn't directly been tested) to take the legal TV you are accessing and then place-shift it so you can watch it over the internet (like with a Slingbox). So, if you combine those two things, why would it suddenly be illegal? The only real difference is that the antenna and the place shifting device sit in Aereo's building rather than in your own home. So, it's just that the "cable" length between the users and the devices is longer. Why should the length of the cable determine whether something is infringing or not? In a few related legal cases, the rulings have been mixed.

There was the ivi case, where the company offered a very similar service, but went with a different legal theory (relying on compulsory licensing rules)... which has so far been shot down in court. Then there was the Zediva case which relied on a very similar theory, but with DVDs (i.e., the company had a separate DVD player for each customer and let you watch movies streamed from that individual player). In that case, the court issued an injunction and the company shut down. Finally, there's the Cablevision ruling in which the TV guys went after Cablevision for offering a remote DVR feature. In a somewhat convoluted, but important, ruling, it was found that a remote DVR could be legal and non-infringing.

While the networks seriously argued that anything that caused anyone to think about cancelling their cable subscriptions could be illegal, the judge in the Aereo case, Alison Nathan, has refused to grant a preliminary injunction (basically doing the opposite of what happened in the Zediva ruling). Zediva was in a different court (and only reached the district court level anyway) so that ruling had little direct influence here. The Cablevision ruling, however, was pretty clearly instrumental in saving Aereo from being shut down.

Much of the ruling focused on what seems like a relatively tangential question: whether Aereo is really creating an individual antenna for each customer, or if it's just building a giant single antenna. More or less, it's a question of whether or not each individual antenna works with the others to better capture the signal. This is also known as a totally stupid debate. I mean, if you were to step back and just look at this from a common sense standpoint, you'd say the fact that Aereo has to set up a different antenna for each customer is pretty stupid. There's no technical reason to do so, only a legal one. It is an expense that serves only to satisfy a legal demand, which is by definition an inefficiency introduced into the market for no reason other than to keep lawyers happy.

But, here, the judge ruled that the individual antenna theory applies, and thanks almost entirely to the Cablevision ruling, there's no reason to issue a preliminary injunction. The networks tried some bizarre theories about why Cablevision didn't apply, but the judge saw through all of the attempts at misdirection:

Despite this creative attempt to escape from the express holding of Cablevision, for the reasons discussed below this Court finds itself constrained to reject the approach Plaintiffs urge. Contrary to Plaintiffs' arguments, the copies Aereo's system creates are not materially distinguishable from those in Cablevision, which found that the transmission was made from those copies rather than from the incoming signal. Moreover, Plaintiffs' attempt to distinguish Cablevision based on time-shifting fails when confronted with the reasoning of that case, particularly considering that the Second Circuit's analysis was directly focused on the significance of Cablevision' s copies but did not say one word to suggest that time-shifting played any part in its holding.

From there, the ruling goes into a wonderfully thorough debunking of the networks' attempt to ignore the ruling in Cablevision and a detailed explanation for why Aereo is quite similar to Cablevision. In the end, the judge also bars the preliminary injunction due to the lack of irreparable harm if the service keeps going for the duration of the trial. The court actually says that it can see how there is a clear case that the networks could suffer irreperable harm, in the form of losing viewers and advertisers -- but that since that "harm" is a longterm one, there's little reason to issue an injunction right now. Separately, the court recognizes that an injunction would almost certainly be "irreparable harm" for Aereo, as it would effectively be a death sentence (as was the case with Zediva). Either way, however, the level of detail the court uses in laying out why Aereo is so similar Cablevision does not bode well for the networks' overall case.

This case is far from over, but in round one, the networks' key argument appears to have taken quite a beating.

Filed Under: broadcasting, dvr, place shifting, television
Companies: aereo, cablevision, ivi, zediva

Australian Collection Society Upset It Doesn't Get To Collect Extra For Radio Simulcasts Online

from the entitlement-society dept

As various collection societies have been getting more desperate to collect more and more fees, a favorite move is to focus in on sky high internet "streaming" rates. In the US, webcasting rates are many, many times higher than the royalties that radio has to pay. It's why there still remain many questions about whether or not webcasting is a viable business, even for giants like Pandora. It's particularly ridiculous when it comes to radio stations who choose to "simulcast" their stations online. Thankfully, down in Australia, there was a ruling that made some sense, saying that radio stations shouldn't have to pay much higher internet rates just to rebroadcast their radio stream online. But what's really telling is the response from the local collection society, PPCA, who wanted to collect all that money:

"We are disappointed by this ruling on a technical point relating to internet streaming but will continue to work hard for a better deal for artists and labels," comments PPCA CEO Dan Rosen.

"Australia remains out of step with other jurisdictions such as the U.K., Canada and New Zealand where radio operators pay significantly higher license fees."

Perhaps the question should be whether or not it's right that those other jurisdictions make radio stations pay so much more for promoting artists? Given the history of payola, where the record labels have shown -- empirically -- that they get tremendous value out of having their artists played on the air and are willing to pay for it... it seems pretty silly to then demand that the radio stations turn around and pay "higher fees" back.

Filed Under: australia, broadcasting, royalties, webcasting
Companies: ppca

Federal Court Invents A New Intellectual Property Right: The Money Makes It So Exclusive Right To Record

from the wtf? dept

Two years ago we wrote about a troubling case coming out of Wisconsin, in which the Wisconsin Interscholastic Athletic Association (WIAA) claimed that it could allow a single exclusive broadcaster for high school sporting events in the state. The Gannett newspapers challenged this by streaming four different events online, eventually leading to this lawsuit. There were other highly questionable limitations on news media, including a claim that they could not even report play-by-play data. That part is the most ridiculous, as that seems like a clear violation on free speech rights, and also goes against previous caselaw that has allowed the reporting of factual game information. But, stunningly, last year, a district court judge ruled that commerce trumps the First Amendment, and since the WIAA needs to make money, such deals are just fine. This didn't make much sense to us, and we hoped that it would be overturned on appeal.

No such luck.

Ima Fish alerts us to the appeals court ruling which upheld the lower court and seems to endorse the creation of a wholly made up new form of intellectual property right that has no basis in the law. The court clearly says that this is not a copyright case, so copyright law doesn't apply. So what right exactly is WIAA granting to its broadcasting partner? That's not clear at all from the ruling. If it's not copyright, it appears to be something entirely made up by the appeals court, which might be loosely defined as "the right to make up restrictions if it makes money." I'm not joking. The court repeatedly focuses in on the idea that the WIAA needs to make money, and that somehow makes it okay to grant a single company an exclusive license.

I don't see how this makes much sense. I could see that they should be allowed to grant a license to an "official" broadcaster, and even give them additional access, but I don't see how they can stop someone else from recording the material and broadcasting it as well -- especially when they admit that it's not a copyright issue.

And since this new exclusive made up imaginary right has no basis in law, we don't know what any exceptions are. Is there a fair use exception like in copyright? The contract says other agencies can show two minutes of streaming video from events, but it doesn't need to say that, and fair use shouldn't be determined by a contract anyway. The whole thing seems bizarre and troubling, in that it seems to suggest that public entities can create a special kind of exclusive broadcast intellectual property right if they use it to make money.

Separately, one small part of the case struck me as interesting in relation to a different case we talked about recently. In the Zediva case, we thought it was ridiculous that the court declared a paid video broadcast to your home as a public performance because the Zediva service was offered to "the public." Yet, in this case, the court insists that sporting events at public schools (which are open to the public) are, in fact, "nonpublic forums." I don't think either description makes sense. A private home is a private place. A public sporting event is a public event.

Finally, the court seems to totally overstate the situation in the ruling here and suggests a clear misunderstanding of the public domain:

The logical implications of Gannett’s argument are breathtaking. Suppose a high-school orchestra were to perform one of Bach’s Brandenburg Concertos or the drama club put together a rendition of Othello (both of which are in the public domain). Gannett’s argument would require the conclusion that the students have no right to engage in the common practice of packaging their performance and selling it to raise money for school trips.

While some of Gannett's arguments may have risen to that level (it did suggest that public institutions shouldn't be able to make money this way), the court also seems to suggest that just because you can't have exclusivity, you can't make money. That's silly, and wrong.

Gannett is still considering its options, but it can ask for an en banc (full court) review or it can appeal to the Supreme Court. I'm hoping it will fight this, because the ruling seems totally nonsensical.

Filed Under: broadcasting, copyright, first amendment, sports, wisconsin
Companies: wiaa

Tweeting Deemed Not 'Broadcasting' And Allowed In Courtroom

from the nice-of-them dept

Michael Scott points us to a case in Connecticut state court, in which "broadcasting" from the courtroom was forbidden, but there was a debate over whether or not Twittering from the courtroom should be allowed. The arguments go back and forth, noting that there are some similarities to broadcasting with Twitter, but not necessarily enough. The judge then looked at the reason behind prohibiting broadcasting, and realized it was to keep direct images from being seen, but that reporting from the courtroom should be allowed. The only concern is if the actions were disruptive (such as with a loud keyboard), but noted that such problems could be dealt with on a case by case basis. The guy trying to restrict the use of Twitter claimed that such "communications tend to be either trivial or inaccurate and thus play no useful role in educating the public about the judicial process," but the judge pointed out that a court should not be controlling the "substance of courtroom reporting," and said that Twittering would be allowed, so long as there is no disruption (which would be dealt with specifically). Seems like a reasonable outcome.

Filed Under: broadcasting, connecticut, courtroom, tweeting

Canadian Telco Claims Netflix & Google TV Should Be Regulated As Broadcasters

from the ah,-protectionism dept

A few years back, you may recall, we covered how some content creators in Canada were looking to expand broadcast regulations to the internet. If you're not aware, Canadian law requires that broadcasters fund and promote a certain amount of Canadian-based content. The reason for it on television is so that Canadian television isn't dominated by American programming -- and the idea here was that there was a similar "threat" online. Of course, unlike television, there is no limit to how much content is available, and artificially trying to force ISPs to fund and promote Canadian content just doesn't make any sense.

However, now, it appears that at least one company, Shaw -- who is both a broadcaster and an internet provider in Canada -- is trying to bring this issue back in a way, claiming that Netflix and Google TV should be subject to similar regulations. Of course, both of these aren't really broadcasters. They're service providers. But that issue seems lost on Shaw. It's especially bizarre in the case of Google, which isn't offering up its own content at all, but merely an interface to access other content online. If anything, this shows the rather obvious and hamfisted manner by which Shaw seeks to burden new technologies that might compete with it for attention.

Filed Under: broadcasting, canada, regulations
Companies: google, netflix, shaw

Clear Channel Says XM-Sirius Merger's Fine -- As Long As It Can Buy More Terrestrial Stations

from the the-more-things-change... dept

Matthew Lasar writes in to let us know that terrestrial radio behemoth Clear Channel says that if the XM/Sirius merger is allowed to proceed, restrictions on terrestrial radio station ownership should be lifted. Once again, by tying the two issues together, Clear Channel is making it clear that terrestrial broadcasters do compete with the satellite radio companies. It's hardly surprising to see Clear Channel take this stance, though, as it's consistently lobbied for the ownership limits (which state that a company can own no more than eight stations per market) to be lifted. The details from a Clear Channel exec's letter to the FCC are slightly amusing. The guy says "With poorer content, local radio stations will lose listeners, and, consequently, advertisers, not because local radio would face a better competitor after the merger, but because it would be able to offer only an inferior product to listeners and advertisers." His comments came in the context of saying that a merged XM-Sirius would lock up all kinds of content through exclusive deals, making it unavailable to terrestrial stations. But taken more broadly, you have to say that the guy knows what he's talking about, given Clear Channel's experience in churning out inferior products with little success.

Filed Under: broadcasting, fcc, mergers, radio
Companies: clear channel, sirius, xm