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APAR's WORKING WEEKEND: Drawing the Line on Digital

27 Jul, 2001 By: Bruce Apar

The ongoing battle between Video Pipeline, Inc. and Buena Vista Home Entertainment is, as Video Store Magazine columnist Seth Goldstein points out in next week’s issue, much more than just another legal matter between a vendor -– albeit one who jealously guards its rights more tenaciously than any other intellectual property holder –- and a middleman.

We wrote about the matter two weeks ago in this cyber space: Video Pipeline claims it has the right, under First Sale, to distribute previews of Disney and other studios’ films to retailers –- whether it’s on a VHS, DVD or via online streaming –- with or without the rights holder’s permission. VPI president Jed Horovitz wrote a letter in response, which we’ll publish in an upcoming issue of Video Store Magazine.

As you can read about elsewhere on this Hive4Media.com site, the first face-to-face confrontation is due Aug. 8 in a courtroom, before a trial date is set.

As Seth expounds in his column, this is an industrywide issue that has galvanized the Video Software Dealers Association (VSDA) and National Association of Recording Merchandisers (NARM) on Video Pipeline’s side -– filing amicus curiae (friend-of-the-court) briefs — like the Motion Picture Association of America on the side of MPAA member Walt Disney Co.

Discussing with Seth what he called this “fascinating” matter -– one that has become a cause celebre for retailers and entertainment rights holders alike -- “digital rights management” came up. It’s a mouthful of a term, but one you’ll be hearing a lot more of if you intend to be part of the digital domain as it applies to the business of home entertainment content.

The “management” part might be considered a euphemism for “protection,” namely that of the rights holder. And that’s what the Video Pipeline-Buena Vista case comes down to really –- where is the separating the rights of the property holder, in this case Disney and its movies, from the rights of the retailer and those who service retailers, in this case Video Pipeline, Inc.

In the very definable, physical realm of packaged goods and storefront retailing, it’s easier to both draw and toe the line. Once any customer, trade or consumer buys a VHS cassette or DVD from the rights owner (the so-called “first sale”), it can be resold or rented without the original owner’s authorization or control. (Which also helps explain why a retailer breaking street date is not violating any legal authority. Street date is a combination of distribution discipline, marketing tool and professional courtesy.) First Sale, of course, does not extend to the purchaser of the VHS or DVD copy having the right to alter its copyrighted contents.

But where do you draw the line when dealing with a movie trailer, for example, that is not on any physical format, but traveling through space from a server directly to somebody’s screen?

Digital rights management is ultra-sophisticated technology intended to control, among other things, the precise path of such content, who can access it, how many times it can be viewed, and at what cost.

So once a preview for, let’s say, Unbreakable, reaches the PCs of Video Pipeline, is it still on Disney’s side of the rights line or on Pipeline’s?

With digital rights management, Disney could prevent Pipeline from accessing the trailer or, alternately, know Pipeline is accessing it and further track where it goes from there.

In fact, come to think of it, with music and video streaming -– as opposed to downloads -– if the end user does not, or cannot, make a home-grown copy, is it ever really out of the control of the rights of the original owner? Before VCRs came along, broadcast TV shows were not.

That is one of the burning questions of the digital age to which we’ll perhaps glimpse an answer, thanks to Video Pipeline and Disney.

Comments? Contact Bruce directly at:bapar@advanstar.com

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