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Monday, March 26, 2007


Is a DVR Recording Copyright Infringement?

Cablevision developed a new way to use DVR systems by providing remote storage instead of hard drive storage on the system itself, one storage unit per person. This remote storage would allow for easy access and probably more storage space than current DVR systems. The problem is that the pseudo-monopolized market, which includes studios and cable networks, believe that this DVR storage is causing infringement issues. To try and downplay the havoc being created by the studios and cable networks, Cablevision is going out of its way to prove that they are not infringing on current copyright laws. Cablevision is using the Supreme Courts decision in 1984 regarding VCR's, that the VCR recordings were legal media. This new system is no different than current DVR's like TiVo that record media and store it on the hard drives, only these hard drives are remote. The studios and cable networks disagree, and state that the process allows the recording to be re-played for free and without approval for those transmissions, referring to them as video-on-demand services. They are still fighting for revenues lost to other competition such as Netflix, Podcast, etc. that is downloadable by consumers and can be replayed after paying only once, not several times.

This has rent-seeking written all over it! The studios and cable networks had a monopoly in this market for years and it has been crumbling because of new technology. So they are fighting this DVR market, Podcast, satellite television, downloadable movies and Internet movie rentals. This is causing a limitation to competition. Because of rent-seeking the Government could intervene and cause this new technology to withdraw, or push license or fees on it so much that it may not survive. It goes against Mancur Olson's economic prosperity system and causes an inefficient economy.

it is interesting, this case, because it would seem like rent-seeking, Big- high profit video companies not wanting there intellectual property distributed without royalties.

but on the converse, protection of property rights (even intellectual property rights) are one of the utmost foundations for normal capitalist market activity.

Is this the case of suppressing one industry (DVRs) for the benefit of another (studios), similar to our margarine Vs. Butter case, or it is a protection of intellectual property, a necessary incentive for free market?

I think that perhaps the best case would either be something like the drug industry. In this industry, a new medication if patented and cannot be Generically copied for 7 years, after that seven years, the patent is up, competition enters the market and normal laizes faires capitalism takes place. We protect both the intectual property incentive, and allow for competition and a mostly unregulated market.

Maybe, if it is even possible, DVRs should be forbidden to record copyrighted material for a time, allowing studios to collect profits, and then after a term, remove the protection and allow the DVR and similar industries to flourish.

That, or no regulation at all might be a good idea. if free market is allowed to function, then the studios will compete with the "bootleggers" and perhaps release DVDs with more features than the recorded copies. This would work, provided that Studios are able to do this, which recently seems like a quite strong possibility
I think either of these are acceptable solutions..
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