The Decision: Today, June 29, 2009, the U.S. Supreme Court agreed with Cablevision that “Network DVR” (NDVR) was a legal use of content for which the MSO has distribution rights. On the loosing side were broadcasters including NBC, CBS, ABC, and Fox, as well as Disney, News Corp and Hollywood movie studios whose argument that NDVR represented an illegal use under US copyright laws was rejected without comment.
What is NDVR ? With NDVR the MSO stores content for their subscribers on network servers allowing subscribers to access previously broadcast content without the burden of buying a more expensive STB with hard drive storage. So this may be a win for the MSO and the consumer: the MSO will no longer be forced to subsidize larger and larger set top boxes and the consumer will no longer need to purchase ever larger storage drives for their favorite recordings.
Extra Server Capacity Solution: The perceived cost savings for the service providers may have a short half-life if they are required to purchase ever greater amounts of server space for their slowing morphing into “long tail” content. However, when I was working at Alcatel the strategy for Telmex, in Mexico, (and not subject to the strict views of the US copyright laws) was to only record shows if one subscriber had requested a delayed viewing. Shows would only be available for a week or two. This prevents needless recording of unpopular shows (as well as indicating which are the most popular shows) and allows a constant culling of the offerings to preserve a set amount of storage capacity.
What About Tivo? Tivo may have the most to lose in this ruling. Having just won their own court case on their recording patents for the home DVR, this could be another blow to their business licensing model. Why pay a “Tivo tax” if you don’t have to? The demise of Tivo has been incorrectly forecast numerous times, but this may be a significant blow.
Affect on Remote Media Sharing: The greater value to the consumer may be an unleashing of the long sought dream of “my content, anywhere, on any device.” If NDVR is embraced by the service provide they will be able to truly offer “multi-room DVR”. And why not strike a deal for bundling mobile and broadband transmission of stored content for a better (and more valuable?) mobile TV experience on a smart phone, handheld gaming device, or in the car?
Tomorrow’s Licensing Models: Though the license holders and content producers may not be pleased with today’s outcome, if they are creative, they may be able to strike more lucrative licensing deals for the use cases of the future which this court decision may usher in.
Keep pushing forward