October 24, 2006 4:00 AM PDT
TVUPlayer: Another Napster?
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"What gray area? The courts have already decided that you can't do this," said Mark Litvack, a copyright attorney for the Los Angeles law firm Manatt, Phelps & Phillips.
Litvack cited a 2000 U.S. district court decision that Canadian company iCraveTV was in violation of copyright law when it captured broadcast signals from the likes of ABC, NBC and CBS and retransmitted them over the Web. The company was forced to shut down.
According to Litvack, the case demonstrated that the courts don't care whether a service retransmits commercials. The most important factor in whether a site is operating legally is whether it has permission from content owners to be transmitting their material.
That said, if TVU Networks is found to be operating illegally, Hollywood may have a tough time going after the company in China, which has had a mixed record on protecting copyright.
Interestingly, instead of adding to the tension between the better-known video-sharing sites and Hollywood, boundary-pushing companies like TVU Networks may actually push them together, argued Josh Martin, an analyst with the Yankee Group.
"You shut down this site and another one will crop up," Martin said. "This tells entertainment executives that they have to create opportunity for consumers to legally access content. Most people will pay the $1.99 for the download or watch the commercial. They just need an opportunity to do that."
In recent weeks, a number of partnerships between sites and studios have been announced. Earlier this month, YouTube announced partnerships with Universal Music Group, Sony BMG Music Entertainment and CBS that let their artists' music and videos be included in original content posted on YouTube's site. Sony acquired Grouper for $65 million, and Warner Bros. cut deals with Guba, a video-sharing site, and BitTorrent, a file-sharing service that allows both to distribute Warner films.
In the meantime, the TVUPlayer's popularity continues to grow on sites such as CNET Network's own Download.com.
"It could be tough to stop these guys," said the Yankee Group's Martin. "(China) isn't known for being tough on copyright law."
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