By Paul Elias
SAN FRANCISCO (AP) --Hollywood calls it “rent, rip and return” and contends it’s one of the biggest technological threats to the movie industry’s annual $20 billion DVD market — software that allows you to copy a film without paying for it.
Last Friday, industry lawyers urged a federal judge to bar RealNetworks Inc. from selling software that allows consumers to copy their DVDs to computer hard drives, arguing that the Seattle-based company’s product is an illegal pirating tool.
RealNetworks’ lawyers countered later in the morning that its RealDVD product is equipped with piracy protections that limits a DVD owner to making a single copy and a legitimate way to back up copies of movies legally purchased.
The same federal judge who shut down the music-swapping site Napster in 2000 because of copyright violations is presiding over the three-day trial, which is expected to cut to the heart of the same technological upheaval roiling Hollywood that forever changed the face of the music business.
The studios fear that if RealNetworks is allowed to sell its RealDVD software, consumers will quickly lose interest in paying retail for movies on DVD that can be rented cheaply, copied and returned.
Their lawyers argue the software violates a federal law known as the Digital Millennium Copyright Act that makes software and other tools that enable digital piracy illegal. They also contend shoppers will widely condone such illegal behavior if RealNetworks’ product is allowed on the market.
Bart Williams, a lawyer representing the studios, told the judge that evidence uncovered in the litigation shows RealNetworks engineers purchased copying software illegal in the United States from a company in Ukraine.
“One is not supposed to copy DVDs and that’s in fact what RealDVD does,” Williams said. “Real’s objective in all of this is to make money off the studios’ investments without paying for it.”
The company argues that the contract it signed with the DVD Copy Control Association, which equips DVD player manufacturers with the keys to unscrambling DVDs, allows RealDVD because the software doesn’t alter or remove anti-piracy encryption like illicit software that is easily obtained for free online.
RealNetworks says its product legally fills growing consumer demand to convert their DVDs to digital form for convenient storage and viewing.
“RealNetworks saw there was an unmet consumer need,” said company lawyer Leo Cunningham. “RealNetworks is a company that respects copyrights.”
In October, U.S. District Judge Marilyn Hall Patel temporarily barred sales of RealDVD after the product was on the market for a few days. At the time, the judge said it appeared the software did violate federal law against digital piracy, but ordered detailed court filings and the trial to better understand how RealDVD works.
The lawsuit has incurred widespread wrath from bloggers, digital rights advocates and groups on both sides of the political spectrum, including former Republican congressman and Libertarian presidential candidate Bob Barr and the left-leaning Electronic Frontier Foundation.
Critics accuse the studios of stifling innovation as they attempt to develop their own copying software.
“It’s all about control,” said Cato Institute scholar Timothy Lee. “No one is allowed to innovate in the DVD space without industry permission.”
The industry, through the Motion Picture Association of America, counters that its goal is to stamp out piracy. It says it welcomes legitimate attempts at innovation.
Regardless of the trial’s outcome — and the judge isn’t expected to rule immediately — some predict that Hollywood control over digital copies will continue to wane because of the proliferation of illegal software online.
“If Hollywood wins, I don’t think much changes in the real world,” said Fred von Lohmann, an attorney at the Electronic Frontier Foundation. “Anybody who wants DVDs copied can download software for free in 10 minutes.”
Google Opens Its Defense In Antitrust Case Alleging Monopoly Over Online Ad Technology
Google opened its defense against allegations that it holds an illegal monopoly on online advertising technology Friday with witness testimony saying the industry is vastly more complex and competitive than portrayed by the federal government.
"The industry has been exceptionally fluid over the last 18 years," said Scott Sheffer, a vice president for global partnerships at Google, the company's first witness at its antitrust trial in federal court in Alexandria.
The Justice Department and a coalition of states contend that Google built and maintained an illegal monopoly over the technology that facilitates the buying and selling of online ads seen by consumers.
Google counters that the government's case improperly focuses on a narrow type of online ads — essentially the rectangular ones that appear on the top and on the right-hand side of a webpage. In its opening statement, Google's lawyers said the Supreme Court has warned judges against taking action when dealing with rapidly emerging technology like what Sheffer described because of the risk of error or unintended consequences.
Google says defining the market so narrowly ignores the competition it faces from social media companies, Amazon, streaming TV providers and others who offer advertisers the means to reach online consumers.
Justice Department lawyers called witnesses to testify for two weeks before resting their case Friday afternoon, detailing the ways that automated ad exchanges conduct auctions in a matter of milliseconds to determine which ads are placed in front of which consumers and how much they cost.
The department contends the auctions are finessed in subtle ways that benefit Google to the exclusion of would-be competitors and in ways that prevent... Read More