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Woulda, coulda, shoulda - October 3, 2008

One thing that should not be overlooked in the legal jousting between the MPAA and Real Networks over RealDVD is the degree to which the studios put themselves in the position they now find unacceptable. But for their own objections, they could have had a deal two years ago on a system to bring private, non-commercial copying of DVDs within the framework of the CSS licensing scheme, where they could have had some input over the how, when and where of the copying. Instead, they now find themselves suing a third-party technology developer for doing it without them.

The original managed-copy proposal was offered by Microsoft in 2006 and embraced by the IT industry representatives with the DVD Copy Control Assn., which administers the CSS license. The plan called for something very similar to RealDVD, in which licensed "managed-copy devices" could decrypt CSS-encoded content on a DVD and use it to create a re-encrypted copy on a hard drive.

The studios' initial response was to insist that the IT and consumer electronics companies in DVD-CCA agree to add a litany of new security features to CSS, including enhanced bus encryption and watermarks, in exchange for the "right" to sell managed-copy devices (they also originally wanted a blanket deal that covered "managed-recording devices" as well but later agreed to address that issue separately). In addition, the studios wanted the system to be essentially voluntary: It would be up to individual studios to decide which titles could be copied.

The IT and CE industries balked at the cost of the additional security features and the studios eventually dropped those demands. But the discussions reached an impasse over the question of whether the system should be "opt-in" (i.e. the default position is no copying unless expressly authorized by the studio), or "opt-out" (i.e. all titles would be copy-able unless some extenuating circumstances--such as rights clearances--meant the studio was not in a legal position to authorize copying).

At a DVD-CCA meeting the week before they filed their lawsuit against Real, in fact, the studios voted down the latest opt-out proposal from the IT industry.

The irony, of course, is that the system devised first by Kaleidescape and now by Real is probably about the best the studios could reasonably hope for in a licensed managed-copy system. The copies are encrypted, remain tethered to the hard drive where they were originally created, and cannot be used to make additional copies.

The studios complain in their court filings that Kaleidescape and RealDVD enable rent, rip and return. But their concern would be more convincing if totally unlicensed DVD ripping programs weren't already widely available and rent, rip and return wasn't already a de facto feature of many a Netflix subscription.

Had they cut a deal two years ago, in fact, the studios might have found willing partners in the IT industry in working on technological measures to reduce the ease of rent, rip and return. Now, not so much.

See you in court.


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