Kaleidescape vs. DVD CCA: Judge Rules Against Movie Servers - AVS Forum
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post #1 of 113 Old 01-27-2012, 08:47 AM - Thread Starter
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Kaleidescape vs. DVD CCA: Judge Rules Against Movie Servers
By Julie Jacobson
Tentative ruling in landmark DVD-copying case says Kaleidescape knew its movie servers might be in violation of DVD CCA licensing agreement that prohibits copying of DVDs.

Kaleidescape, a prominent manufacturer of high-end movies servers, has lost its eight-year battle against the DVD Copy Control Association, the organization that licenses decryption software for DVD players.

The DVD CCA sued Kaleidescape in 2004, arguing that its products violate a licensing agreement that expressly prohibits the copying (ripping, archiving) of DVDs.



Judge William J. Monahan of the Santa Clara County Superior Court in California issued the tentative judgment favoring the DVD CCA on Jan. 9, 2012. The ruling is subject to revision pending input from the two parties. If it stands as written, the DVD CCA can permanently prohibit Kaleidescape from selling DVD movie servers. The DVD CCA also may collect monetary damages (amount to be determined) from the defendant.

This landmark case could set a precedent that would make all DVD movie servers illegal - that is, all servers whose makers have a license with the DVD CCA.

We are very disappointed by the tentative decision, Kaleidescape CEO Michael Malcolm tells CE Pro. "The DVD CCA is controlled by the six large movie studios in concert with some of Kaleidescape's competitors. They object to the innovations of the Kaleidescape System, and want new Kaleidescape Systems to require the presence of the DVD in a disc vault, as with Blu-ray Discs today. Despite the evidence presented at trial, Judge Monahan has tentatively adopted a statement of decision that was drafted by the DVD CCA, which goes far beyond anything in the license."

Click here to continue.
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post #2 of 113 Old 01-27-2012, 09:06 AM
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Didn't something like this happen a few years back, and yet Kaleidescape is still making and selling movie servers...
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post #3 of 113 Old 01-27-2012, 09:11 AM
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I've never understood how an industry can go to war against its customers and partners who increase sales. If GM started harassing used car lots with lawsuits and tried to shut down makers of third party floormats, it wouldn't fly. Yet somehow the entertainment industry is allowed to get away with it?
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post #4 of 113 Old 01-27-2012, 09:35 AM
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Agreed. I don't think, that the big movie and music pirates out there are using Kaleidascape devices. With their large price tag, the owners of most of them have the financial means to buy their movies/music. It is the people that are trying to cobble something together from a 5 year old PC and $100 that are, statistically, more apt to want something for their ripped Redbox/Netflix/BBMoviePass discs.

Generalized statements only, there are obviously, somewhere, Kaleidascape owners that have illegal movies, and owners of a super cheap setup that have all legit content.
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post #5 of 113 Old 01-27-2012, 09:49 AM
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Sounds like Kaleidescape will need to include their BD carousel solution for DVDs as well. I wonder how they will handle their current solution customers since they would technically be illegal servers.
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post #6 of 113 Old 01-27-2012, 10:01 AM
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A lot of rich snobs are going to be sad.
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post #7 of 113 Old 01-27-2012, 10:03 AM
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Quote:
Originally Posted by WebEffect View Post

A lot of rich snobs are going to be sad.

Since when are rich snobs the only ones that want to be able to store movies on a server instead of juggling discs? This could have a chilling effect on any innovation in this arena. Whatever happened to that managed copy we were promised with HDDVD and BD anyway?

I guess we can just all live with crappy streaming versions if we want to stop juggling discs.

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post #8 of 113 Old 01-27-2012, 10:04 AM
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Quote:
Originally Posted by adidino View Post

Sounds like Kaleidescape will need to include their BD carousel solution for DVDs as well. I wonder how they will handle their current solution customers since they would technically be illegal servers.

Since they are (likely) internet connected, I'm sure at some point they will be "upgraded" to comply.

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post #9 of 113 Old 01-27-2012, 10:12 AM
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Originally Posted by jparr View Post

I've never understood how an industry can go to war against its customers and partners who increase sales. If GM started harassing used car lots with lawsuits and tried to shut down makers of third party floormats, it wouldn't fly. Yet somehow the entertainment industry is allowed to get away with it?

Keep in mind the Kalidescape product line is very expensive and their customer base is the financial elite.

The Wall Mart DVD customer isn't going to care about this at all, in fact some may applaud it. "now the rich guys have to watch their DVD like the rest of us".

The studios absolutely care about their customer base. But this whole DRM issue rarely affects the average content buyer in any way they can understand, relate to, or care about. As long as you can buy last years movies for $4.99 in the checkout isle, the vast majority of the studios customers are happy as a clam.

And the GM analogy is slightly flawed. If those third party floor mat manufactures were to utilize GM patented materials or processes to make their floor mats, GM would surely come after them. Likewise the studios aren't trying to shut down independant producers from making movies. They are just protecting their own assets. No different than any manufacture protecting their patent portfolio.

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post #10 of 113 Old 01-27-2012, 10:23 AM
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Quote:
Originally Posted by Glimmie View Post

The Wall Mart DVD customer isn't going to care about this at all, in fact some may applaud it. "now the rich guys have to watch their DVD like the rest of us".

That statement does not hold true once they (majority) have had a taste of innovation. Take away these same folk’s ipones/ipads and DVRs. See if they are still happy.

If the majority of us have had a taste of what Kaleidescape provides, we would not sit back and applaud. Keep in mind that this is going to set a precedence and in the end will hurt the little guy. Those with Kaleidescape may only see this as a minor pain in the a$$. Those with homemade servers will be the ones left with illegal devices while the rich add another device (if they even care about DVD anymore).
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post #11 of 113 Old 01-27-2012, 10:31 AM
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Originally Posted by thxman View Post

That statement does not hold true once they (majority) have had a taste of innovation. Take away these same folk’s ipones/ipads and DVRs. See if they are still happy.

If the majority of us have had a taste of what Kaleidescape provides, we would not sit back and applaud. Keep in mind that this is going to set a precedence and in the end will hurt the little guy. Those with Kaleidescape may only see this as a minor pain in the a$$. Those with homemade servers will be the ones left with illegal devices while the rich add another device (if they even care about DVD anymore).

Iphones, Ipads,and DVRs don't challenge DRM policies. Nobody is thinking of suing the makers of those products. Now lets see what happens if Dish or DirecTV puts out a DVR with a BR recorder built in that can hard copy bit for bit anything you record. Let's see how long that stays out of court.

The homemade servers are perfectly safe. After all they are already using illegal ripping software!

And the average customer base does or soon will have everything the Kalidescape offers for a lot less money - STREAMING! yeah, yeah, the quality isn't as good but it's more than good enough for the average customer.

I'm not supporting this decision at all. It's just the way it is for better or worse.

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post #12 of 113 Old 01-27-2012, 10:35 AM
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Originally Posted by turls View Post

Since they are (likely) internet connected, I'm sure at some point they will be "upgraded" to comply.


Not sure what you mean. Unless I'm missing something, the only way to comply is to purchase a Carousel for your collection. Only owners with BD collections are using the Carousel. DVD owners have been able to rip until this point.

I'm sure a patch will be distributed to disable the ripping feature but I'm referring to making use of their current investment.
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post #13 of 113 Old 01-27-2012, 10:40 AM
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Originally Posted by adidino View Post

I'm sure a patch will be distributed to disable the ripping feature but I'm referring to making use of their current investment.

No need to. Just stop manufacture and phase out support. The product in question will soon die on its own.

Or just offer an attractive buyback for the carousel unit.

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post #14 of 113 Old 01-27-2012, 12:11 PM
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With this and SOPA, it seems like studios are trying to clear the field so they can enter and own the market. Once they are the ones providing the service, then they'll be happy to not bother manufacturing DVDs and still charging $17/movie.
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post #15 of 113 Old 01-27-2012, 12:50 PM
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Originally Posted by SantosLH View Post

With this and SOPA, it seems like studios are trying to clear the field so they can enter and own the market. Once they are the ones providing the service, then they'll be happy to not bother manufacturing DVDs and still charging $17/movie.

Well it's their product. If Warner charges $17 per download, Paramount is free to charge $15 or less. That's how it works.

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post #16 of 113 Old 01-27-2012, 01:15 PM
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Originally Posted by Glimmie View Post

Well it's their product. If Warner charges $17 per download, Paramount is free to charge $15 or less. That's how it works.

That would work if they didn't agree to charge the same for their DVD's and movie tickets... and agree to not release big movies on the same days/weekends.

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post #17 of 113 Old 01-27-2012, 01:24 PM
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That would work if they didn't agree to charge the same for their DVD's and movie tickets... and agree to not release big movies on the same days/weekends.

But they can charge what ever they want, release what ever they want, when ever they want. It's their product.

A lot of people on these AV forums seem to think the studios are a public service and therefore everyone has rights to their material.

Well that's wrong. It's the way OTA television works but the studios are a private business just like the airlines or the auto industry. As long as they adhere to commerce laws, they can set their own policies.

If you don't like the policies of United Airlines, then fly Delta or American. If neither of those go where you need, tough!

If you don't like Ford's warranty policy, then buy a Chevy. If Chevy doesn't make the car you want, tough!

Why do many people here think the studios are any different. If they do too much damage, their product will not sell and their stock will fall. It will self correct.

Again that's how it works. Or are some suggesting a government regulated entertainment industry?

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post #18 of 113 Old 01-27-2012, 01:24 PM
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I find it hard to believe that with the knowledge and ability that SOME people have here, that this is even an issue. there are ways to serve your purchased dvds on your own server that do not involve handling discs after youve copied them. if you choose not to pursue this its your option but kaleidescape is not necessary to do this.
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post #19 of 113 Old 01-27-2012, 01:25 PM
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My main motivation for wanting a server is to get rid of the forced ads, annoying menus, BD live and all the other worthless garbage that ruins the movie experience.

I want to drop in a disc, sit down, hit play, and enjoy the flick.

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post #20 of 113 Old 01-27-2012, 01:36 PM
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Quote:
Originally Posted by digital_b_avs View Post

I find it hard to believe that with the knowledge and ability that SOME people have here, that this is even an issue. there are ways to serve your purchased dvds on your own server that do not involve handling discs after youve copied them. if you choose not to pursue this its your option but kaleidescape is not necessary to do this.

That's not really the issue in discussion. It's about Kaleidescape, this ruling and how Kaleidescape will handle this with current owners and future owners.
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post #21 of 113 Old 01-27-2012, 02:58 PM
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Originally Posted by Glimmie View Post

The studios absolutely care about their customer base. But this whole DRM issue rarely affects the average content buyer in any way they can understand, relate to, or care about. As long as you can buy last years movies for $4.99 in the checkout isle, the vast majority of the studios customers are happy as a clam.

And the GM analogy is slightly flawed. If those third party floor mat manufactures were to utilize GM patented materials or processes to make their floor mats, GM would surely come after them. Likewise the studios aren't trying to shut down independant producers from making movies. They are just protecting their own assets. No different than any manufacture protecting their patent portfolio.

The correct analogy is if GM installed anti repair devices to their vehicles and only mechanics who paid a licensing fee had the right to repair them. Anybody else would be breaking the law by working on the car.

I also vehemently disagree that the studios care about their customers. What they care about is maintaining control of their products, for eternity if possible, and continually extracting money from the end user.
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post #22 of 113 Old 01-27-2012, 03:26 PM
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I also vehemently disagree that the studios care about their customers. What they care about is maintaining control of their products, for eternity if possible, and continually extracting money from the end user.

And how is that different from Coke or Pepsi for that matter?

Like I said above, the studios are a for profit business. They are not some public service every tax payer has a right to use.

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post #23 of 113 Old 01-27-2012, 03:47 PM
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Most everyone on this forum has been digesting the information that the internet freely distributes, which convinces them that the music and movie companies are somehow richer and greedier and more evil than any other companies on the earth and that any attempt for them not to even do whatever other company does (including the ones that these same folks work for and therefore they benefit from in the form of a paycheck), but just to get some basic control over the theft of their product, is somehow against all our human rights. It's pretty crazy.

People have been stealing content for so long that any attempt to stop them will immediately be met with angry backlash and condemnation. There are plenty of threads on the internet that show how out of hand it's gotten. People will call them Nazis for even attempting to stop people from stealing from them. No matter what they do they are demonized. Here is a good example here on AVS from the last couple weeks:

http://www.avsforum.com/avs-vb/showthread.php?t=1387422

And, the thing is, this case really has zero to do with the larger issue. Kaleidescape signed a contract with the CCA. It has nothing to do with the larger laws of copyright or any of that, AFAIK. It's a contract dispute between the two companies. Though it is the case that if K loses, then it will be the legal end of the argument that the CCA has the right to enforce the provisions in the contracts that they make with other people and that one of those is the non-copying one. But it doesn't depend on the DMCA or anything else in this case because it's a business to business legal issue, and even if no DMCA existed if the contract does say no copying and K signed it, then that would be that it would seem to me.

Also, I would point out that I went to a get together back I guess in the early 2000s where they were showing off one of their units (they are not far from my apartment I think.) Someone who was quite wealthy, with what was obviously a couple hundred $K home theater, was test driving it and invited some folks to come down.

One of the first things he said after the test drive was, Hey, I can just rent all the discs I want and copy them onto this and have them any time I want to see them. So clearly their concerns about this are valid. Not that the number of K system users are large, but it's the precedent involved. I'm sure that they either do have larger signees who might put out more widely accessible, lower cost systems of this sort, or may in the future have such signees.

The basic fact of the matter is that these companies are just being ripped off enormously, and they are trying to do what they can to stop it. Every system out there that makes it trivial to steal their stuff just contributes to the appearance that their stuff is in fact and should be free, when it's not and shouldn't be. And people will continue to try to characterize their attempts to keep from getting ripped off as fighting their own customers, when it's not.

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post #24 of 113 Old 01-27-2012, 04:04 PM
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Quote:
Originally Posted by Glimmie View Post

And how is that different from Coke or Pepsi for that matter?

Coke and Pepsi do not sue the makers of glasses for allowing soda to be drunk from anything other than the can it was sold in.

Once you buy a Coke or a Pepsi, you are free to drink it from the can, pour it into a glass, use it to make soda popsicles, a mentos-pepsi rocket car or anything else you want.

Once you buy a movie, a studio executive claims, "No, you only purchased a license to watch that movie in a way that I approve of. No, you may not load it onto a server that gives you more value from the movie. No, you may not skip the ads that we force you to watch before the movie starts. If your disc breaks, you cannot watch the movie unless you buy another disc even though technically you still have the 'license' to watch that film. If you want to upscale it to 1080p, you cannot do that via component video unless that conversion is done in a separate box that we don't have regulatory authority over."

I could probably come up with more, but I think that is enough.
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post #25 of 113 Old 01-27-2012, 04:25 PM
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That's because Coke or Pepsi don't stand to lose anything if you do those things, whereas the people who make movies do, and some of those things cannot be done without effectively making their product free to anyone without the conscience to pay for it when it is free, and the number of those people is shrinking every day.

BTW, how many DVDs actually have ads that you cannot skip in today's players? Of all the ones I have or have had, I don't think that there has been a single one, so it doesn't seem to me like it's a plague or anything.

On the broken disc thing, look, if you want to pay twice as much for discs, and have to register every one and pay for the infrastructure for them to track who owns every disc and pay a transfer fee, etc... all the things you have to do for other products that you want to have this type of convenience, then I'm sure it would be doable. They could provide you with another given proof of purchase. But if you want to buy them at bargain basement prices with full anonimity, then that's just not going to happen. They cannot afford to keep up with who owns what, and therefore cannot provide you with a replacement.

Companies that do do that, generally software companies, charge a lot more for their products and you have to register them and provide them with personal information in order to get that kind of service.

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post #26 of 113 Old 01-27-2012, 04:33 PM
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A very interesting topic. Let me start off by saying that I am not an expert on this topic and the following is just my humble opinion on what I know so far.

Lets see, you buy a Kaleidescape, your friend down the street has 1000 Blu-ray titles of the best movies of all times, or you rent from Netflix, and now you can record them all for free and see them when ever you like. Yeah, that's fair right! ....

Don't get me wrong, I think the K is a cool toy... But if a movie is one and half hours or longer, don't you have to get up anyways... Say for a beer or a rest room break... And as far as I know the sound from a K system and say another quality BD player is the same. So if that is true, then that is a lot of money to stay seated when you probably have to get up anyways. And 20K plus buys a lot of cool high end equipment. And yes I know that to some that is not a lot of money... but still... really?

Hopefully in the end it works out for every one. I am sure that one day everything will be on a hard drive whether you stream a blu-ray or buy it that way, and a hard case and disc will be a thing of the past.

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post #27 of 113 Old 01-27-2012, 05:21 PM
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Quote:
Originally Posted by Glimmie View Post

And how is that different from Coke or Pepsi for that matter?

Worst analogy ever!
Coke or Pepsi allows me to drink their product however I want, I can even give it to a friend.


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Like I said above, the studios are a for profit business. They are not some public service every tax payer has a right to use.

That's true but they bribe politicians so they can get copy-protection(copyright extension, DMCA, SOPA, etc). Why is a patent only good for seven years but a copyright is "life plus 70 years"? If you piss off enough customers they will boycott a product.
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post #28 of 113 Old 01-27-2012, 05:25 PM
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Anyone still watching dvds needs to wake up! Blu-Ray or bust people! Unless it's some kid movie/tv show or an old movie that just hasn't been converted, I couldn't watch a dvd if I tried. Yes I hate the studios as much as the next guy, but a ruling over dvd's just seems comical in 2012.
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post #29 of 113 Old 01-27-2012, 05:31 PM
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Quote:
Originally Posted by Mr.Poindexter View Post

Coke and Pepsi do not sue the makers of glasses for allowing soda to be drunk from anything other than the can it was sold in.

Once you buy a Coke or a Pepsi, you are free to drink it from the can, pour it into a glass, use it to make soda popsicles, a mentos-pepsi rocket car or anything else you want.

Once you buy a movie, a studio executive claims, "No, you only purchased a license to watch that movie in a way that I approve of. No, you may not load it onto a server that gives you more value from the movie. No, you may not skip the ads that we force you to watch before the movie starts. If your disc breaks, you cannot watch the movie unless you buy another disc even though technically you still have the 'license' to watch that film. If you want to upscale it to 1080p, you cannot do that via component video unless that conversion is done in a separate box that we don't have regulatory authority over."

I could probably come up with more, but I think that is enough.

Here, here!
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post #30 of 113 Old 01-27-2012, 05:44 PM
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First, let me say WebEffect you are a jackass. Even if only "rich snobs" were their only customer who are you to call them anything other than "successful" at making money? Isn't that part of the American dream?

Second, the prices have come down to in the $5k range so it is not out of reach for those willing to save.

Now, I use to work for Kaleidescape and I know for a fact that these systems actually created DVD sales. Many of the customers that would buy these systems would place monthly orders for all new DVD's through Amazon or other company that would deliver them. Think of the new DVD's that come out in a month and many would buy them all just to have them available should they, or their guests, ever want to watch them. Can't watch a movie without the disc in the first place.

Stop with the BS about money. If you do not have enough do whatever it takes to get more, if you have "more" then obviously you did what was required to get it. I am sick of the whining in this country where opportunity is all around us. Don't blame me if I decide to sacrifice, put in the effort to make more than someone else.

For the record, I do not own a Kaleidescape. I did when I worked for them and it truely is the most awesome thing ever but alas I would not spend my cash on one as I have more important things to do with my money. (yes, investing some to try to get ahead)

Kevin
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