Movie-Streaming Sites Claim Legal Cover With DVD-Ownership Models

MovieSwap
Via YouTube

Startups MovieSwap, VidAngel offering members online access to video content ripped from discs

Hollywood studios, which have long patrolled the Internet to stamp out copyright-infringing activity, are grappling with a new gambit to sidestep their usage restrictions: websites claiming that users who own DVDs can stream those movies any which way they want.

The latest trying this approach is French startup MovieSwap, which says it has compiled a library of more than 200,000 DVDs. Subscribers will be able to choose to either send in their physical DVD collections and then be able to stream them online; “swap” them with other users; or pay to receive DVDs that are added to their digital collections. “This process ensures that users are always swapping one DVD for another, thus making the process legal,” the company said in announcing the service.

MovieSwap on Tuesday launched a Kickstarter campaign and by Wednesday afternoon had raised $24,456 out of its $38,464 goal from 870 backers, who are promised free access for life after the service first launches in beta this summer.

Another service, Utah-based VidAngel, takes a different tack. Members can effectively rent HD streaming access to new releases for $2, after they purchase a DVD of the title for $20. They can then “sell back” the DVD to VidAngel and receive an $18 credit toward their next movie purchase.

Are either of these services kosher? No way, says one exec at a large studio: Such sites “are not in any way authorized to either rip or stream our content,” said the source, who requested anonymity.

The MPAA, the trade group that represents major studios, declined to comment. It’s not clear if the industry is contemplating legal action against MovieSwap or VidAngel.

The two companies defend their services as falling within legal bounds. MovieSwap, which is promoting itself with the hashtag “#FreeTheMovies,” says the service functionally is identical to the way a consumer can legally lend DVDs to friends or trade them — only on “a much larger scale thanks to its remote playback technology.”

“Our goal is to give the power back to the people by enabling them to digitally watch the films they already own,” MovieSwap CEO Cyril Barthet said in a statement. “We don’t want the $200 billion invested by the American people on their DVDs to go up in smoke because the technology is now obsolete.”

VidAngel CEO Neal Harmon, in an interview, said that his company is positioned as a family-friendly alternative to traditional streaming services. Founded in 2013, VidAngel lets customers watch DVDs streamed over the Internet using community-created filters for individual titles to eliminate sex, violence, profanity or other objectionable material.

“You can watch ‘Game of Thrones’ without the rape scenes,” he explained. “If you buy a toy, you can write your name on the toy. We’re saying, if you buy a movie, you can choose to skip content in that movie.”

VidAngel says it’s protected by the 2005 Family Entertainment and Copyright Act, which allows the use of technology to censor portions of DVDs. “If somebody wants to watch a movie without filters, we refer them to another site,” Harmon said. “Or, after they’ve already purchased the DVD, we ship them the actual disc if they request it.”

The VidAngel service represents a private performance, according to Harmon: “If our users are the owners (of a DVD), they have a right to a private performance.” That’s different from services courts have deemed engage in copyright infringement because they deliver a public performance, such as broadcast-TV streamer Aereo or DVD rental startup Zediva, he said.

Copyright holders have fought businesses that have tried similar approaches — and won. In 2000, major music labels sued MP3.com over its service that let users stream songs over the Internet after registering their CDs. MP3.com lost the copyright battle and eventually settled with the record companies.

Ultimately, how aggressively the movie biz tries to challenge VidAngel or MovieSwap may come down to scale. If either one starts to attract a significant number of users, expect the studios to swing their legal teams into action.

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  1. Marianella Hill says:

    I Love VidAngel because now I don’t have to worry about my kids watching a movie because even on PG-rated movies they show bad language. does anyone knows where we can protest and sign a petition to the court to help VidAngel stay alive!! I know there is a lot of people that cares about what your kids watch or we watch!

  2. Paul K. says:

    Unfortunately, the author fails to mention ClearPlay and its important role in the the 2005 Family Entertainment and Copyright Act (important detail). The portion of the act that allows people to watch filtered movies “…arose out of a lawsuit between ClearPlay, a Salt Lake City-based company that markets DVD-sanitizing technology, and a number of Hollywood studios and directors. The ClearPlay technology allows a home consumer to screen out up to 14 different categories of objectionable content, such as drug use, sexual situations, or foul language.” (Wikipedia). It’s the DVD equivalent of what the streaming service VidAngel does – and yes, the movie industry did file a lawsuit, but when Congress passed the 2005 Family Entertainment and Copyright Act, the lawsuit went away. Bottom line, the movie industry is not filing lawsuits now because they know they would lose. VidAngel is legal – like it or not. The industry allows their movies to be filtered to be shown on network television anyway. Honestly, I think they won’t be happy unless fast-forwarding was not allowed and we are all strapped into our chairs like the Alex in the movie Clockwork Orange, with his eyelid pried open with clamps (as part of the “Ludovico technique”). The movie industry needs to get over themselves.

  3. The point of art is to help us view the world through someone else’s perspective. We take in what we see and hear, digest it, and maybe walk away with a different viewpoint. Editing out content you don’t like just to keep your filtered worldview robs the art of its purpose. That to me is the real tragedy.

    • srgmac says:

      I have the same view but no one is forcing anyone to use this service…It’s more for people who want to watch shows with their kids or people who have gone through traumatic experiences and don’t want to be triggered by a rape scene, for example…But — at the end of the day, VidAngel has a lot of customers who apparently, like the service and want to use it. So..if there’s a demand for this type of thing, far be it for me to tell anyone else what they should buy, so long as they don’t tell me what I should buy…ya know? Live and let live.

    • Aaron Head says:

      It’s a good thing you’re not being forced to use VidAngel then, isn’t it? Haha. Feel free to use other streaming services.
      And just because you don’t agree with the concept of filtering movies doesn’t make it a “tragedy.” Everyone has a right to their own opinion, and everyone has the right to watch a movie however they want to, either censored or uncensored. VidAngel simply gives people a choice.

  4. I have used Vidangel for several months and I love it.

    Movie studios should think about this: There are a lot of people like me who would never watch certain movies without filtering out the offensive content. So Vidangel is creating new customers for the studios. Otherwise they would get no money from these people for many of their movies.

    • So you’re not okay with “objectionable” content but you’re ok with stealing other people’s hard work? VidAngel is not Netflix nor Hulu. They are not paying content creators for the rights to stream those movies. To steal from someone else, make a profit off of it, and then just cut the artist’s vision is disgusting.

      • srgmac says:

        How dare you accuse him of stealing anything…When you watch something on VidAngel you BUY the DVD or Blu Ray! You’re not stealing…It’s basically as if there is a DVD Player or a Blu Ray player in one area — and then, connected to that player, is a monitor — but the monitor is connected by a very very long cable…That’s not streaming stuff to the public, that’s not really streaming at all. It’s a private performance that only the owner (you) can watch. In fact, nothing is even being copied. The single disc is being read, and transmitted to your monitor, and then when one frame is played, it’s gone — it’s not stored or saved.
        I have no doubt that the MPAA and their lobbyists will destroy VidAngel but I don’t see anything wrong with what they are doing. The studios are just butt-hurt that they can’t charge their extra fees so their owners can buy new yachts. Trust me, the people that actually write and create and direct, and even act in these movies don’t get paid squat compared to the networks / studios anyway.

      • Seth says:

        Vidangel doesn’t force any filters on a movie. You can watch it with no filters if you choose. I don’t see how it’s stealing just because they have a large audience compared to me selling my dvds at a garage sale. They’ve married the internet, streaming and technology very well.

      • Aaron Head says:

        Using VidAngel is not stealing people’s hard work. When you watch a movie on VidAngel, you literally purchase the BluRay or DVD. VidAngel is simply a DVD and BluRay reseller.
        And you don’t need to pay content creators, or even have their permission, to buy and sell their movies. If that was required, then sites like Ebay, Half, and Amazon would all be breaking the law. And anybody selling movies at a garage sale would be breaking the law. It’s just simply not true. You’re imagining laws that aren’t there. :)

  5. Bill Kilpatrick says:

    I would love for this to be legitimate. To get Redbox prices without getting shot over a 24-hour rental of Eat, Pray, Love would be a thing of beauty. But even with the fiction that you are “buying” the content, how can a company in Utah stream a new release for $2 when every other streaming service is charging $5? Something tells me this is all going to end like the Hindenburg, with stupefied looks and expressions of surprise and that famous phrase, “Oh, the humanity!”

    • srgmac says:

      Because they aren’t being charged for a streaming license by the content owners, which means they don’t have to pass that fee on to you. So long as physical media is involved….But I have a feeling even physical media will be entirely obsolete soon enough. The content owners don’t want people owning a physical copy of their stuff anymore. They want it to be all digital, that way they maintain total control — and at the end of the day, you are just a “renter” — NOT an owner.

    • Chris says:

      The way it seems, you spend 20 on the movie, then if you return it, you get 18 on your account (not cash but store credit)

  6. This was my conclusion too. I don’t see how they have the right to rip and stream DVDs for you.

  7. CapitalP says:

    DVD is obsolete? News to me.

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