The business and culture of our digital lives,
from the L.A. Times

Category: Bit Player

CES 2012: Dish offers week of prime-time shows on demand

Hopper will be Dish Network's new digital video recorder.

The capacity of today's hard drives is so enormous, the average consumer might have a tough time figuring out what to do with it. Dish Network has an idea: How about giving TV viewers the chance to watch every prime-time program on the four major networks that they missed in the last week?

The satellite operator, which is the third-largest pay-TV provider in the United States, announced at the Consumer Electronics Show in Las Vegas on Monday that its new Hopper digital video recorder will have an extra tuner dedicated to capturing all the prime-time programs broadcast by ABC, CBS, Fox and NBC. It also will have a 2-Terabyte hard drive, giving it enough room to hold on to all those recordings for eight days -- along with hundreds of hours of movies and shows chosen by each Hopper's owner.

It's a gimmick, sure, but a potentially useful one -- both for Dish and for its customers. Dish rival Time Warner Cable offers a "look back" service that enables subscribers to watch a broad range of prime-time programming from the previous three days, although the recordings are stored at the cable company's central office, not in subscribers' homes. Unlike a digital video recorder, however, the service doesn't let viewers fast-forward through commercials, which is one of the most appealing features of a DVR like the Hopper.

In addition, the Hopper helps close the gap between the time a show is broadcast and when it becomes available online through Hulu and other authorized sites. Networks routinely hold programs back until the day after they're broadcast; Fox delays them for eight days, although Dish subscribers can get those programs within a day. With a Hopper, there is no waiting.

The ultra-roomy hard drive also enables Dish to store a large supply of movies and shows for on-demand viewing, albeit not to the extent that cable operators can. On-demand service has long been cable's big advantage over satellite; cable is a two-way network that can send programming on request to individual homes, but satellite is a one-way system that broadcasts programming to entire regions.

Satellite operators have tried to overcome that technological disadvantage by teaming up with broadband providers to offer on-demand services through the Internet, and by caching programs on their subscribers' DVRs that can be unlocked for viewing on demand. The larger the capacity of the DVR, the larger the library of programs that can be cached.

The Hopper is designed to feed smaller set-top boxes, called Joeys, in other rooms of the home. According to Dish, a home equipped with a Hopper and three Joeys can watch four different recorded shows simultaneously.


CES 2012: What it's got, what it doesn't

CES 2012: Tobii technology enables your eyes to control computers

CES 2012: Rovi lets movie fans convert DVDs to digital files for a fee

-- Jon Healey

Healey writes editorials for The Times' Opinion Manufacturing Division. Follow him at @jcahealey.

Image: A Hopper digital video recorder. Credit: Dish Network

CES 2012: Rovi lets movie fans convert DVDs to digital files for a fee

Rovi Digital Copy schematic
At the Consumer Electronics Show in Las Vegas Monday, Rovi Corp. announced what appears to be the first legal tool to convert consumers' DVD collections into digital files that can be played from on online library. It's not exactly iTunes Match for movies, but it's a step in the right direction, with caveats -- lots of them.

One of the main benefits of the digital revolution has been to release music, photos, books and video from their physical bindings, enabling consumers to access their media collections any time, anywhere, on a variety of devices. Those benefits haven't extended to DVDs, however; the discs' anti-piracy software deters people from making functional digital copies of the movies on the discs.

That's "deters," not "stops." It's technically possible to circumvent a DVD's safeguards and copy it, and the software exists to do so. But under federal law, it's illegal to make, sell or distribute such circumvention tools, even if the copy is being made for a legal use. And the Hollywood studios have mounted legal assaults against a series of companies (e.g., 321 Studios and RealNetworks) that have put DVD copying software on the market.

Unlike their ill-fated predecessors, Rovi isn't actually creating copies of DVD movies. Instead, it has created an app for Internet-connected Blu-ray disc players that can read the unique identifier on each DVD or Blu-ray disc, then offer the disc owner the chance to store a copy of that movie online. It won't be free, however; Richard Bullwinkle, Rovi’s chief evangelist, said the studios participating in the service plan to charge a small fee for the stored copy. The fee will be higher for high-definition copies than for standard-definition ones.

The fee is just the first of the caveats. The second is that Rovi's disc identification will work only on Blu-ray players capable of downloading and running a new Rovi application. Bullwinkle wouldn't name the manufacturers that will support Rovi's app, but the possibilities include disc players from Samsung and LG and Microsoft's XBox 360.

The third is that the stored movies will be protected by some form of digital rights management software that limits which devices can stream or download the files. Users won't be able to use the online locker of their choice; instead, they'll have to rely on a service blessed by the studios. Again, Rovi isn't identifying any specific partners yet, but a good bet would be Best Buy's CinemaNow and others that use Rovi's e-commerce technology.

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CES preview: Yet another rollout for mobile digital TV

RCA 2012 MDTV MIT700

Five years ago, Samsung unveiled a digital TV broadcasting technology that was optimized for mobile devices. It's still waiting to sell its first broadcast-enabled smartphones in the United States, just as the TV industry is still waiting for the notion of mobile DTV to take off. But there are signs that the wait may be coming to an end.

On Wednesday, a coalition of TV stations and networks announced a partnership with mobile phone company MetroPCS that will enable the latter's customers in Los Angeles and 13 other markets to tune in the stations' mobile DTV signals later this year. The first compatible device will be an Android smartphone made by Samsung, which will use a telescoping antenna for better reception. In the meantime, RCA plans to show off an Android-based flat-panel TV (shown above) that can tune in the coalition stations' service (called Dyle) at next week's International Consumer Electronics Show in Las Vegas.

The coalition's formal name is the Mobile Content Venture, and its membership includes Fox, NBC, Univision, Telemundo, ION Television and about a dozen large station ownership groups. Their members have been installing mobile DTV transmission equipment at 72 stations in 32 markets, which reach half of the U.S. population, according to Erik Moreno, a senior vice president at Fox Networks Group and the co-general manager of the coalition. "We needed to make that first move to convince someone like MetroPCS" to offer mobile DTV service to its customers, Moreno said.

That investment by the coalition's members helps overcome the chicken-and-egg problem faced by mobile DTV. But it remains an open question whether consumers will tune in. Qualcomm's high-profile effort to broadcast TV programming to specially equipped cellphones attracted few viewers, in part because it offered only a limited selection of programming. The company eventually abandoned the venture and sold the airwaves to AT&T.

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Marvell unveils the brains inside next generation of Google TV

Marvell, a Santa Clara, Calif.-based semiconductor designer, announced Thursday that the next generation of Google TV will be built around one of its chipsets

Marvell, a Santa Clara, Calif.-based semiconductor designer, announced Thursday that the next generation of Google TV will be built around one of its chipsets. The specifications of its reference design show, predictably, a considerable advance in power and chip integration over the first generation of Google TV: For example, Marvell's Armada processor is a dual-core chip, as opposed to the single-core Intel Atom processor found in Logitech's first-generation Google TV product. That's welcome, but the main problems with Google TV thus far have been business-model and software shortcomings. In other words, even if a Marvell-powered Google TV is more powerful and less expensive, it won't necessarily be more appealing.

According to Marvell co-founder Weili Dai, the semiconductor platform her company designed can handle high-definition 3-D movies and video games in addition to smart-TV applications. One complaint about the initial Google TV products, which debuted in October 2010, was that the roster of apps was thin. But Dai argued in an interview Wednesday that the open platform provided by Google TV will attract the same kind of attention from developers that the Android operating system has for smartphones.

"Many people are writing apps on that platform," Dai said. "Every day, every hour [they are] building that capability. ... What you saw for Android and smartphones in general is happening now with the smart TVs and the Google TVs of the world."

A bigger hurdle for Google has been the decision of many important suppliers of television programming online -- including Hulu, the four major broadcast networks and several popular cable channels -- to block Google TV from displaying the online versions of their shows. That reflects the networks' fear that Google TV could encourage people to swap their cable TV subscriptions for free TV online, undermining an important source of revenue for the industry.

The programming and software issues have been so significant that one of the two original Google TV vendors, Logitech, abandoned the product last month. That was a few months after the company revealed it had more returns on the unit than sales in the second quarter of 2011, prompting it to slash the list price from $250 to $99.

Dai said Marvell has cut the cost of the box's chips to the point where companies can "build very affordable devices." She also said she believes that consumers' experience with the connectivity, utility and flexibility of smartphones makes them hungry for a similar capability on the big screens in their home. But she conceded that it's up to Google and the TV industry to come up with a business model that persuades more content providers to embrace the Google TV platform.

"When Android was born, there was the learning curve. The Google TV side is the same thing," Dai said. Google has opened up the TV business model, but now "they need to work within the ecosystem," she added. "I'm hopeful they will resolve that."

Google TV products based on the new Marvell chips are expected later this year. Dai declined to identify any of the manufacturers, but at least some of them are likely to show off prototypes at the International Consumer Electronics Show in Las Vegas next week.


Apple to reinvent TV?

Google rolling out new version of Google TV

Samsung close to deal to making Google TVs

-- Jon Healey

Healey writes editorials for The Times' Opinion Manufacturing Division. Follow him at @jcahealey.

Photo: Marvell's reference design for its Foresight Platform, which powers the next generation of Google TV. Credit: Marvell

Online music: Rhapsody reaches 1 million subscribers, finally

RhapsodyRhapsody, the longest-running subscription-music service, announced Thursday that it had finally crossed the 1 million subscriber threshold. Before you cue the cork-popping, bear in mind that Rhapsody launched almost exactly 10 years ago, so its growth isn't setting land-speed records. And three years ago, Rhapsody and rival Napster each reported having about 750,000 subscribers. The two companies are now combined, thanks to Rhapsody's purchase of the fast-declining Napster in October, but the total is far less than the sum of their erstwhile parts.

So the announcement doesn't exactly herald the dawn of a new era for subscription music services in general or Rhapsody in particular. The total number of people who pay for on-demand music services online is still dwarfed by the more than 21 million who subscribe to Sirius XM. And in a country of more than 110 million households, 1 million isn't mass market.

Nevertheless, Rhapsody President Jon Irwin insists that the new total is a real milestone. Although online music services have notched higher subscriber counts before, they were inflated by the inclusion of customers who'd signed up only for low-cost premium radio services. More important, Irwin noted that the way subscribers use Rhapsody has crossed a significant threshold as well. For the first time, most of that usage is not on a personal computer. Instead, more than half of the playback is on mobile phones, stereos, TV set-tops and other consumer electronics, with smartphones accounting for 40%.

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Grooveshark: the latest test of online safe harbors

Online music service Grooveshark is swimming in murky legal waters, as evidenced by the copyright-infringement lawsuit that three major record companies are now bringing against the site's owners and several of its executives. Judging from the amended complaint filed Thursday by Universal Music Group, Warner Music Group and Sony Music Entertainment, however, that lawsuit won't be the last in a series of epic battles between tech companies and the entertainment industry over third-party liability. Instead, the case may hinge on the company's employees own efforts to stock the online jukebox.

Grooveshark lets people stream tracks from an online library of millions of songs. Some of those songs -- the ones the company has licensed from EMI, a major record company, and numerous independent labels -- were uploaded by Grooveshark. The rest -- including thousands of unauthorized hits owned by Universal, Warner and Sony -- were uploaded by users in violation of the site's terms of service, company executives say.

The company has long argued that it's not liable for the unauthorized songs because it's protected by the 1998 Digital Millennium Copyright Act. The law provides a safe harbor for companies that give the public a place to store or share material online, provided that they don't know about or benefit financially from the infringements and that they take down infringing material when it's pointed out to them.

If Grooveshark is right, the lawsuit may turn out to be a meaningful battle over a DMCA-compliant site's duties in the face of rampant piracy -- in effect, a rematch of Viacom's unsuccessful lawsuit against YouTube. (Viacom's appeal is pending at the 2nd Circuit Court of Appeals.). But the major labels' complaint seeks to avoid that fight by alleging that Grooveshark doesn't comply with the DMCA and isn't eligible for a safe harbor.

They base their claim on e-mails, internal documents and online comments by someone claiming to be a Grooveshark employee, all of which suggest that Grooveshark executives knew about and profited from the infringements. For example, the supposed whistleblower alleged that the company ordered employees to upload songs from the major labels, including the ones taken down in response to the copyright owners' complaints.

That sort of allegation has been a standard feature of the entertainment industry's lawsuits against online piracy hotbeds. In some cases, such as the suits against Limewire and Grokster, those internal documents helped convince judges. In others, such as Viacom versus YouTube, they didn't.

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Seeking to copy -- legally-- from Blu-ray discs and online media

One of the criticisms of the digital locks used by broadcasters and Hollywood studios is that, in trying to squelch piracy, they can interfere with fair uses of copyrighted material by other artists. And under federal law, it's illegal to circumvent those locks. Chicago-based Kartemquin Films (the subject of the video at top) and other documentary filmmakers won a temporary exemption from that law a year and a half ago, with the help of students at the USC Intellectual Property and Technology Law Clinic and lawyers from Donaldson & Callif of Beverly Hills. Now the clinic and the firm are seeking to extend the exemption to all filmmakers and authors of multimedia e-books.

The 1998 Digital Millennium Copyright Act made it illegal to circumvent "technical protection measures" on DVDs and other digital media. That created a dilemma for filmmakers who wanted to use a snippet from an earlier movie on DVD: Even if the use wasn't infringing, they could still be sued for going around the locks. So even though circumvention tools are widely available online (despite the fact that they're illegal to make or distribute), filmmakers used them at their peril.

That's why documentarians sought an exemption from the Copyright Office in 2009. Recognizing the potentially chilling effects of the anti-circumvention provision, lawmakers had included in the 1998 law a requirement that the office consider granting relief every three years to those whose non-infringing uses were adversely affected. The exemption documentarians won in July 2010 applies only to DVDs, and it expires next year.

In seeking a new exemption, the filmmakers are focused on two problems, said Jack Lerner, a law professor at USC who directs the Intellectual Property and Technology Law Clinic.

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EMI and Echo Nest create a 'sandbox' for app developers

GorillazIt's tough to succeed in the music business, not just as a musician, but also as a company building products around musicians' work. The guy working the sound system at the club always gets paid, but for everyone else it's a crapshoot.

The lengthy roster of defunct online music companies illustrates this point. Liquid Audio, FullAudio, CenterSpan,, Echo Networks, Myplay, Music Buddha, Uplister, Musicbank, Streamwaves.... I could go on (and on and on), but you get the point. One problem for such innovators is the gantlet the major labels make them go through to obtain content or use it in new ways. It drives up costs, delays launches and adds uncertainty, making it hard for start-ups to raise badly needed capital.

That's a problem Echo Nest, which provides an online platform and music-analysis tools for application developers, is trying to solve. On Thursday the Massachusetts-based company and EMI Music are launching a digital "sandbox" designed to give developers a one-stop shop for building applications based on EMI content. It's not a guaranteed license -- EMI retains the right to approve the apps that would use its artists' songs, videos and related material. But it promises to simplify and speed the process of winning EMI's approval considerably.

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UltraViolet on eBay? No big deal

Green Lantern
The first two Blu-ray discs that support UltraViolet went on sale this month, enabling purchasers to stream or download copies of the films in addition to simply playing the disc. This week, however, reports emerged from GigaOm and the Wall Street Journal that some buyers were selling their UltraViolet rights on eBay for $1 or $2. Oh, the horror! Here's how the Journal's Michelle Kung put it:

It took three years for a consortium of more than 70 movie studios and technology companies to create UltraViolet, the new online storage service that was designed to make buying movies more appealing to tech-savvy consumers.

It’s taken those same consumers less than two weeks to figure out a low-cost work-around.

The situation isn't quite that dramatic. Consumers aren't hacking or circumventing the electronic locks that UV uses to deter unauthorized copying. They're just not using the system in the way it was designed to be used.

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Grooveshark: the other free music service

Grooveshark screen grab

This post has been corrected, as indicated below.

The "freemium" business model may be taking off among online music services, but the conventional wisdom is that Spotify and other proponents will never make money off of their free, advertiser-supported tiers. Instead, the key will be hooking people with the free offering, then persuading them to pay for an upgraded tier.

Spotify's newly released financial statements seem to back up that view. As the company grew in 2010, so did its losses.

Don't tell Paul Geller that free music on demand is a money-loser, however. Geller is vice president of business development at Grooveshark, an advertiser-supported site based in Gainesville, Fla., that streams an unlimited amount of music on demand to users at no charge. Grooveshark has been rocking the freemium model for longer than Spotify -- in addition to its free tier, it has a $6-a-month advertising-free plan and a $9-a-month service that works on modified smartphones (more on that later). But Geller is bullish about the site's potential to generate enough ad dollars to be profitable, even after paying royalties (more on that later too).

That's largely because of the data generated by Grooveshark users. By analyzing that data, Geller said, the company can target ads much better than other sites (as demonstrated by higher click-through rates), pair artists with brand advertisers in mutually advantageous ways, and help labels market artists far more effectively.

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