ArtsWatch: Barry Diller's Battling Antenna

Senate hearing explores online video channels; Diller fight dominates
April 30, 2012 -- 7:06 am PDT
By Philip Merrill /

In recent news ...

An April 24 Senate Commerce Committee hearing on the emergence of online video surveyed the crowded thicket of legacy television laws and consumers' changing habits, dominated by mogul Barry Diller's retro reliance on the humble antenna as the legal basis for his controversial Aereo service. "Sometimes, in the face of the ubiquity of cable and satellite, consumers forget that they can access broadcast television with an antenna," said Diller. Sen. Jim DeMint (R-S.C.) questioned whether Aereo's business model was essentially a gimmick to charge consumers for access to content without having permission to retransmit broadcasters' signals — an issue pending litigation in the Southern District of New York's U.S. District Court. Blair Westlake, Microsoft's corporate vice president, media & entertainment group, addressed the nub of the business problem while promoting his own company's "over-the-top" video offerings on Xbox. "While many see the old models as under pressure in the long term, the new alternative business models have not yet come into view," said Westlake. "The future of video is as much — or even more — dependent upon companies devising sustainable and innovative business models that reflect the possibilities of this exciting time [as on] technology deployment." Nielsen Vice Chair Susan Whiting called attention to the fast-growing demographic of 33.5 million smart phone owners watching a monthly average of 4 hours and 20 minutes of video on their mobile phones. The average American watches slightly more than that on their personal computer but watches more than 146 hours per month of traditional television — so online video has plenty of room to grow. Supporters of over-the-top Internet video services hope broadband availability and Net neutrality will continue to receive special attention since both are essential to these business models — the former so that consumers will be able to ramp up to use online video more heavily and the latter so that video services providing the data don't get stuck with transmission costs. Amazon VP for Global Policy Paul Misener called attention to the added complication that "how consumers — especially young people — now think of television does not match longstanding legal and regulatory conventions." In the midst of this changing video landscape, Diller's claims on behalf of Aereo antennae show that sustainability can come down to the willingness and financial resources to fight.

Australian Internet service provider iiNet scored its third and final legal win on April 20 against claims by content owners and antipiracy organization Australian Federation Against Copyright Theft that the ISP authorized infringement. The case was brought in lower court in 2008, appealed to Federal Court with a Feb. 2011 loss for plaintiffs, and the High Court of Australia has now ruled against it. Plaintiffs alleged that about half of iiNet's traffic was BitTorrent file-sharing and that the ISP had been notified of actual infringement on multiple occasions, without taking sufficiently effective action in response to qualify for safe harbor protections. Defending against these claims, iiNet estimated that its litigation costs were more than $9 million. AFACT described the ruling as evidence that Australian law needs to be changed. AFACT Managing Director Neil Gane said, "Now that we have taken this issue to the highest court in the land, it is time for government to act. We are confident the government would not want copyright infringement to go on unabated across Australian networks."

On April 20 a Hamburg District Court ruled in favor of German rights society GEMA in a case against YouTube. The court ruled that YouTube bears some responsibility for infringing material uploaded from users, should filter and block content previously flagged by copyright holders, to prevent it from being reuploaded, and must implement keyword filtering to better detect infringing uploads. Digital Music News noted that compliance with the ruling would show the world "what a fully implemented, more serious filtering system would look like on a platform like YouTube."

The European Data Protection Supervisor issued an opinion regarding the Anti-Counterfeiting Trade Agreement on April 24, expressing concern that its implementation could harm privacy. Assistant EDPS Giovanni Buttarelli said, "A right balance between the fight against IP infringements and the rights to privacy and data protection must be respected. It appears that ACTA has not been fully successful in this respect." The EDPS was particularly concerned that ISPs processing personal data, in voluntary cooperation with enforcement efforts, might exceed the boundaries of what European law permits. Opposition to ACTA in Europe has become a popular movement. The European Parliament is expected to vote against the antipiracy enforcement agreement on May 29, and the European Commission has referred ACTA to the European Court of Justice for a ruling on its consistency with European law.

Voltage Pictures has filed a new mass consumer infringement lawsuit over unauthorized downloads of its movie The Hurt Locker. This time the targets are approximately 2,500 Charter Communications Internet subscribers who downloaded the film in 2010. The lawsuit is a first step toward subpoenaing the subscribers' personal identities, based on their Internet Protocol addresses, so that they can be individually contacted. Thousands of similar cases have been settled and lawsuits like this have been negatively characterized by consumer advocates as "shakedowns."

On April 17 the Federal Communications Commission published a helpful checklist about secure and encrypted use of Wi-Fi networks. These have played a role in consumer copyright infringement lawsuits as some defendants claim that illegal downloads to their IP addresses were committed by others piggybacking onto their unsecured home Wi-Fi networks.

World Intellectual Property Day was celebrated on April 26. The World Intellectual Property Organization linked to numerous commemorative events worldwide and dedicated this year's holiday to visionary innovators. The U.S. Copyright Office observed that technological innovation now "affects the very means by which works are created and knowledge is accessed" and published a timeline of U.S. copyright going back to 1787.

The Recording Academy actively represents the music community on such issues as intellectual property rights, music piracy, archiving and preservation, and censorship concerns. In pursuing its commitment to addressing these and other issues, The Recording Academy undertakes a variety of national initiatives. ArtsWatch is a key part of an agenda aimed at raising public awareness of and support for the rights of artists. To become more involved, visit Advocacy Action @ and sign up for Advocacy Action E-lerts.

Click on the "ArtsWatch" tag for links to other GRAMMY News stories in this series.

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