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11.20.2006

TiVo taps the Internet for content

TiVo taps the Internet for content

TiVo enthusiasts will soon be able to use their devices to watch Internet video content on their TV set, the company announced Tuesday.

The company's expansion as a broadband video portal, as well as a manufacturer and television interface provider, includes three new software features and several content partnership agreements.

"These are features that are really changing what the TiVo service is," said Tara Maitra, general manager of programming at TiVo. "It's a creation that will make TiVo different from generic digital video recorders and opens up the content beyond what's available on digital cable and satellite."

Owners of TiVo's DVRs will be able to share home videos with other users. Through a partnership with One True Media, an online video and photo service, TiVo users can upload home video to the Web and share a channel code with other TiVo owners.

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TiVo also signed deals for TiVoCast content with Reuters; Forbes; dLife, a health content network; Plum TV, a lifestyle network featuring vacation hot spots; and Nano Network, an independent film and theater outlet.

In addition to the One True Media partnership and the TiVoCast offerings, the company announced a broadband video service for watching Web videos on TV. That broadband video service requires TiVo Desktop Plus 2.4, which will be free for version 2.3 owners and $24.95 for TiVo subscribers. TiVo Desktop Plus 2.4 converts videos in QuickTime, WMV and MPEG-4 formats into a TV-viewable format and enables them to be imported to the TiVo box. The software must be downloaded to a PC running Windows XP that is connected to the TiVo box either directly or via a home network.

"The real question is whether this (addition of Internet video access) is going to sell more TiVo boxes, and I think the answer to that is no," said Josh Bernoff, a Forrester Research analyst.

"There is no way for TiVo to monitor the content in this situation, because it's the TiVo consumer who is downloading the content to their PC and then offloading it to the TiVo device."
--Tara Maitra, general manager of programming, TiVo "Internet video looks pretty crappy when you put it on a big TV set, and transcoding doesn't solve that," Bernoff said. "I am a lot more encouraged that (TiVo is) making relationships with content owners."

But TiVo owners may have the opportunity to download more than just crappy movies. Besides the technical parameters of the three formats the TiVo software can convert--QuickTime, WMV or MPEG-4 files free of digital rights management (DRM) protection--TiVo users will have complete control over the Web video content they choose to upload to TiVo via the Desktop Plus 2.4 software. That means that things like copyright movies that pirates manage to upload to peer-to-peer such as BitTorrent or social networks such as YouTube could potentially be illegally downloaded to a PC and then uploaded to a TiVo box.

TiVo does not plan to police the content that millions of device owners download to their own PC, according to Maitra.

"TiVo, basically, will be a receiving device, in the sense that the content that a subscriber pulls from the Web needs to be in a format that is not DRM-protected," Maitra said. "There is no way for TiVo to monitor the content in this situation, because it's the TiVo consumer who is downloading the content to their PC and then offloading it to the TiVo device."

TiVo has been struggling to gain new subscribers. In March, the company signed a partnership with cable provider Comcast to provide software to its DVR boxes. The deal will give TiVo access to Comcast's 23.3 million cable subscribers, though the product has been slow in reaching the market.

In rolling out the new video features, TiVo plans to keep the goodies to itself. TiVoCast, as well as the Web-to-Internet broadband video service and the One True Media home video-sharing feature, at this point, are going to be "strictly available through the TiVo standalone service," Maitra said.

As companions to all the new content available, TiVo said it will be offering a new search feature in 2007 for finding and recording content across "broadcast, cable and broadband content sources." An additional deal with International Creative Management will also offer TiVo owners new TV show and film recommendations from famous Hollywood actors and directors.

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Adding new features is usually a tool used to retain existing customers, Bernoff said. While retention is a problem for cable providers afraid of losing customers to satellite television, customer retention has not been a problem for TiVo. TiVo's challenge, Bernoff said, is to acquire new customers.

"You are about to see, starting in 2007, announcements from a bunch of new Internet-connected DVRs and, of course, TiVo's competition is and continues to be from the cable and satellite boxes available for free across the United States."

DVR owners are mainly interested in three things from their DVR: "to skip commercials easily, pause live TV, and record and view all episodes of a given show," Bernoff said, referring to a Forrester Research survey.

"All the new features...may make the TiVo box a whole lot more interesting to the TiVo owner, but it's very obscure stuff to be selling to a potential customer," Bernoff said. "They're not saying, 'Well, if only I could get access to Internet video, then I'd buy a TiVo box.'"

"I know we are hearing of DVRs with Internet video, but I have not heard of any service that is going to provide an all-encompassing service, combined with what has already been tested and proven as one of the easiest-to-use interfaces," Maitra said. "Having it all available in one location is going to be one differentiating factor. And it's all going to be made available in the easy-to-use TiVo interface."

Universal Music Sues MySpace

After its CEO said in September that YouTube and MySpace owe Universal Music Group “tens of millions of dollars,” the media giant has followed through with its threat and filed suit against MySpace for copyright infringement, according to the Wall St. Journal (subscription required). The most interesting part of the suit is that Universal is alleging that MySpace participated in the copyright violations by transcoding copyrighted video so that it can be replayed and sent to other users.

The Journal notes that today is also the day that MySpace is introducing a new tool that will allow copyright holders to flag unauthorized content on the site. That tool (our coverage) uses technology from Gracenote. MySpace said in a press release that the suit is “unnecessary and meritless.” That transcoding argument sounds like a serious one to me.

Weeks after threatening YouTube and MySpace both this fall, Universal signed a licensing agreement with YouTube the day before the Google acquisition was announced. It also sued Sony’s Grouper and Bolt for copyright infringement.

Is a fresh round of heavyweight copyright wars breaking out? Is there any possibility of an out of court settlement between the two companies? This week’s Craigslist court decision immediately comes to mind. The online directory was ruled on Wednesday to not be responsible for discriminatory housing postings on its site. The court found that Craigslist is a conduit and not a publisher. That ruling was complicated and fell under the Federal Communications Deceny Act. Universal’s lawsuits, against Grouper, Bolt and now MySpace appear headed for a direct test of the DMCA Safe Harbor provision, which is believed to protect parties to copyright infringement so long as they remove copyrighted content upon request. The argument about transcoding video may be the killer in this case.

Music Companies Lose Suit Against Baidu.com in Beijing

Music Companies Lose Suit
Against Baidu.com in Beijing
By GEOFFREY A. FOWLER in Hong Kong and ANDREW BATSON in Beijing
November 18, 2006; Page A7

Leading Chinese Internet-search company Baidu.com Inc. won a lawsuit filed against it by a group of music companies over its MP3 search engine, the latest in the media industry's effort to win intellectual-property protection in China's courts.

The ruling, which was announced by the industry group and can still be appealed, wasn't available, so the judgment's exact basis wasn't clear. At issue was Baidu's practice of so-called deep linking to unlicensed songs stored on other Web sites. The music industry said that making music tracks available in this way, without the consent of owners, is a breach of copyright.

The International Federation of the Phonographic Industry filed the suit last year in Beijing on behalf of seven companies over the public-transmission rights of 195 recordings, which Baidu had made accessible to the public. A number of news reports have said the lawsuit sought damages of 1.67 million yuan, or about $212,000.

Both foreign and domestic copyright holders are increasingly turning to the Chinese court system for recourse against alleged infringements, including litigants who have gone after the landlords of DVD store owners. And while the physical piracy of goods like CDs and DVDs has long been the main concern of U.S. and European Union trade officials, online piracy is gaining increasing attention.

The IFPI said it plans to appeal the ruling. "I am amazed by this inexplicable judgment that is totally out of step with Chinese law and with court decisions made against similar services around the world," the IFPI's chairman and chief executive, John Kennedy, said.

The music industry has won similar cases against deep linking in the Netherlands, Norway and Australia.

A Baidu spokeswoman said the company won the case but declined to provide a copy of the ruling and had no further comment. The IFPI also didn't provide a copy of the judgment.

An attorney for Baidu, Li Decheng, said the company had won this round of the legal battle. "I agree with this first-instance judgment. But it's not the final judgment," he said. "If IFPI appeals, Baidu surely will respond."

Universal Music Sues MySpace Claiming Copyright Infringement

Universal Music Sues MySpace
Claiming Copyright Infringement
By ETHAN SMITH and JULIA ANGWIN
November 18, 2006; Page A3


Universal Music Group, the world's largest recorded-music company, sued News Corp.'s MySpace for copyright infringement, alleging that the social-networking giant traffics in "user-stolen" content, including music, videos and other material.

At issue is the widespread presence of copyright music and video content on MySpace. In the suit, filed in U.S. District Court for California's Central District, Vivendi SA's Universal dismisses the frequently used label "user-generated content" -- alleging that much of the material on MySpace is stolen from copyright holders.

The move signals that content companies remain sensitive to how their intellectual property is deployed on the Internet. Universal Music particularly has been among the most-aggressive content creators in sabre-rattling against potential copyright violators.

MySpace and Universal have been negotiating toward a deal in which News Corp. would pay a licensing fee for Universal content. However, News Corp. balked at Universal's demand that News Corp. pay restitution for content that had previously appeared on MySpace, according to a person close to the situation.

The suit also comes less than three weeks after MySpace, owned by News Corp., announced it was testing a system from Gracenote Inc. of Emeryville, Calif., to filter Universal Music content from its site. People familiar with talks between the two companies characterized that test as the final step before a putative licensing deal.

A Universal spokeswoman declined to comment on the filtering system. But the music company's court filing cited recent widespread leaks on MySpace of superstar rapper Jay-Z's forthcoming "Kingdom Come" album as a factor.

Universal executives have been outraged by the leak. In a recent interview, Antonio Reid, chairman of Universal's Island Def Jam Music Group, said next week's debut of the Jay-Z album would likely be "devastated" by the leaks. "I'm sure it's cut into our sales, and not by a small amount," Mr. Reid said. "Even if it [sells] a million units it's not what it should have been."

So-called user-generated content sites have been an increasingly hot issue for music companies and other copyright holders. Universal and two other big music companies recently reached blanket licensing deals with YouTube Inc., shortly before it was acquired by Google Inc. Universal sued two smaller sites, Sony Corp.'s Grouper Networks Inc. and Bolt Inc., over copyright infringement.

In September, Universal Chairman Doug Morris made public statements that were widely interpreted as threats to sue MySpace and YouTube. Since then MySpace has been taking steps to take copyright material off its Web site. In addition to last month's test of the Gracenote software, on Friday, hours before the lawsuit was filed, MySpace announced it had set up a system to make it easier for copyright holders to report infringements.

Universal said in a statement that its content has "created hundreds of millions of dollars of value for the owners of MySpace," and added that it was seeking to "ensure that our rights and those of our artists are recognized."

A statement released by MySpace said in part that it had "no doubt we will prevail in court."