Inside Move: Download divide

Report ups H'wood hand vs. vidtailers

Studios got some welcome news last week when the U.S. Copyright Office delivered a stinging blow to video retailers hoping to claim their piece of the online movie market without too much headache — or expense.

In the analog world, vidtailers don’t have to seek additional permission before renting or selling cassettes and DVDs. Under the “first-sale” doctrine, they own those copies free and clear.

But things are different in the digital age, when a movie downloaded from the Internet looks good no matter how many times it’s copied, say copyright authorities in Washington.

Hence, the Copyright Office recommended that the online vid biz not be allowed to rent or re-sell digital downloads obtained from the studios without specific permission. This would force anyone hoping to offer downloaded movies to first obtain a license from the studios. And licenses cost money.

The Copyright Office’s report — forwarded to Congress — says the Digital Copyright Millennium Act of 1998 doesn’t need to be amended significantly, disappointing vidtailers who had wanted the first-sale doctrine extended to digital downloads.

Vidtailers argue that forcing them to obtain licenses will allow the studios to squash competition online and force consumers to pay higher prices.

The Motion Picture Assn. of America praised the report, saying studios are feeling more comfortable about making pics available on the Internet without fear of piracy.

Indeed, MGM, Paramount, Sony, Universal and Warner Bros. recently announced plans to begin offering movie downloads directly to consumers. And Disney and Fox are expected to reveal their video-on-demand plan soon.

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