• The Dispute Over TiVo Technology Which Aims To Increase Digital TV Consumers' Viewing Options, While Still Preventing Piracy
  • September 23, 2004 | Authors: Jonathan M. Eisenberg; Matthew L. Eanet
  • Law Firm: Manatt, Phelps & Phillips, LLP - Los Angeles Office
  • High-quality digital television broadcasting ("DTV") is a technological reality. However, the transition from analog TV broadcasting to DTV has been slowed by major broadcasters' fears that their digital broadcasts can and will be widely redistributed for free among consumers on the Internet, such that broadcasters will have difficulty making this technology work economically.

    Addressing this issue, last year, the Federal Communications Commission (the "FCC") required makers of digital TV receivers, by July 1, 2005, to have their devices recognize and respond to a digitized "broadcast flag," which broadcasters can embed in their broadcast signals for the purpose of preventing them from being distributed in digital form beyond the devices that were specifically designated to receive them. It is presumed that if broadcasters have such technological access controls, they will invest in and implement DTV more quickly. (Of course, the success of the broadcast flag likely will depend on its resistance to computer hackers' efforts to circumvent the technology.)

    FCC Chairman Michael K. Powell and many companies in the entertainment industry have argued that the broadcast flag is necessary to preserve free television broadcasts for millions of consumers, given that piracy has become so easy to perpetrate, stealing money and control from "content" companies. On the contrary, many high-tech product manufacturers have complained that the broadcast flag represents burdensome government regulation that hinders technological innovation in the consumer electronics industry. Consumer and "fair use" advocates also have argued that the FCC has exceeded its mandate in implementing the broadcast flag regulations, to the detriment of consumers' enjoyment of digital audiovisual content. Indeed, some of these groups are presently challenging the FCC regulations through litigation pending before the U.S. Court of Appeals for the District of Columbia Circuit.

    Against the backdrop of the broad debate over the broadcast flag, TiVo Inc., maker of a popular digital video recorder, has developed "digital output protection" technology, called TiVoGuard, which is designed to permit each participating TiVo user to make limited redistribution of digital broadcasts without the express consent of the owners of the content. Specifically, the redistribution is limited to 10 TiVo devices (e.g., TiVo digital video recorders or specially-equipped "TiVoToGo" computers) owned by the same person and associated with the same TiVo customer account. The idea is to allow TiVo customers to view movies and programs "on the go," in various physical locations, while still protecting against the mass unauthorized redistribution of digital content over the Internet. TiVo's technology, if accepted, may reflect an emerging, compromise position in the dispute over redistribution of DTV content and other digital content.

    However, organizations such as the Motion Picture Association of America (the "MPAA") and the National Football League (the "NFL") have contended that TiVo's new technology, as currently configured, will not be sufficient to stop piracy. Moreover, this technology will inhibit content owners in managing their broadcasts. For example, if the NFL wants to impose geographically-based blackouts of certain football game broadcasts, TiVo users will be able to defeat this goal by transmitting broadcasts into the blacked-out geographical area so long as the receiving entity is TiVo-approved.

    Recently, the FCC certified TiVo's technology as complying with the broadcast flag regulations, clearing the way for a rollout of TiVoGuard and TiVoToGo. (At the same time, the FCC approved other companies' technologies that use "proximity controls" to ensure that a DTV transmission is shared only within a confined physical space, such as the approved receiver's home.) The MPAA has petitioned the FCC to reconsider its authorization of the TiVoGuard technology absent sufficient proximity controls.

    It remains to be seen whether the FCC will grant the MPAA petition. If not, the MPAA may seek review in federal court. One FCC commissioner also has noted that the certification can be revoked later if, in practice, TiVo's technology does prove to increase piracy of copyrighted content.