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From LawMeme:

LawMeme has an analysis of a new report that shows that PVRs are not as bad for TV advertising as thought ( Study: PVRs Not Necessarily the Death of TV Advertising ).

Jamie Kellner, chairman and CEO of Turner Broadcasting (an AOL Time Warner company), was recently interviewed by INSIDE.com on the future of television. In the interview, Mr. Kellner said some very interesting things, including characterizing those who skip television commercials as thieves:

" [Ad skips are] theft. Your contract with the network when you get the show is you're going to watch the spots. Otherwise you couldn't get the show on an ad-supported basis. Any time you skip a commercial or watch the button you're actually stealing the programming."

To help develop Mr. Kellner's unfortunately common (at least in Hollywood) view of copyright, LawMeme offers the top ten new copyright crimes, as well as further choice quotes and commentary from Mr. Kellner's interview.

The Top Ten New Copyright Crimes

10. Watching PBS without making a donation.
You know who you are, you cheap ...

9. Changing radio stations in the car when a commercial comes on.
Future radios will prevent listeners from changing channels when a commercial comes on. The RIAA has not yet taken a position on whether it is permissible to switch channels when the listener doesn't like the song.

8. Channel Surfing during commercials, especially with Picture-in-Picture capability.
Similar to radio, skipping through channels, particularly when combined with picture-in-picture (which permits viewers to know precisely when an ad block ends), will be prohibited.

7. Getting into a movie after the previews, but just in time for the main feature.
Theaters will be required to close their doors once the advertising and previews have begun. The MPAA has not yet taken a position on time-in-seat requirements for advertising in the pre-preview slide show or whether audiences should be compelled to watch the credits at the end of the movie.

6. PBS
How can commercially sponsored broadcast networks compete with a government sponsored network?

5. Inviting friends over to watch pay-per-view.
When you call to authorize viewing, you will be required to indicate the number of people present to watch. Compliance will be monitored and viewers must identify themselves.

4. Blocking pop-up ads on the Internet.
Yeah, Mozilla and Opera users, this means you!

3. Not buying things from the advertisers on television shows.
Part of your contract is that not only do you watch the advertisements, but that you subsequently buy from the advertisers. If you don't buy from the advertisers, the whole system breaks down.

2. Watching MTV if you are older than 35 or Matlock reruns if you are younger than 40.
Advertisers buy ads to reach a particular demographic. If you aren't part of that demographic you are, effectively, a thief.

1. Libraries and librarians.
This is why we have the Racketeer Influenced and Corrupt Organization (RICO) Act.

Seriously, Kellner, who is a very powerful man, has said some truly disturbing things in his interview. Not merely once, or off-the-cuff, but multiple times in many different ways. At least Kellner is reasonably straight forward in his intentions, unlike Jack Valenti.

Kellner on bathroom breaks:

"I guess there's a certain amount of tolerance for going to the bathroom. But if you formalize it and you create a device that skips certain second increments, you've got that only for one reason, unless you go to the bathroom for 30 seconds. They've done that just to make it easy for someone to skip a commercial."

Here, of course, he is referring to the ReplayTV 4000, which can skip forward in 30 second increments and has already been sued (basically, using Kellner's theory). Of course, note that there is only "a certain amount of tolerance." Go to the bathroom too much and you are a thief.

Kellner on Sony v. Universal, i.e. the Betamax case

"Our company is working on a number of different VOD [Video on Demand] models. The question's whether these are going to be head-end-based models or in-home models and whether ultimately there's going to be a license required for use of the copyrighted material, or whether people make a bet the Betamax case can cover this usage. My bet would be the Betamax case is not going to cover this usage. What was a highly questionable decision with the new technology will not stand up to the potential of the digital world. Whether there's going to be a challenge or whether it's going to be legislation, there's going to be some way in the digital world that we can protect copywritten material. I think that that's inevitable...."

"Again, I think that whether it's legislation, whether it's new technology, whether it's challenging Betamax, whatever it is in the video marketplace, we're going to have to find a way to protect copywritten material or there will be less of it made or it will not be made available in windows where it's not protectable and that's not good for consumers, so there's got to be some way it's protected."

Basically, Kellner is challenging the legitimacy of Sony v. Universal, which made it clear that VCRs are legal. While most copyright owners claim not to want to interfere with the right of citizens to time shift, Kellner does away with the pretense. In his view, Sony "was a highly questionable decision" in the first place.

Kellner on Napster

"The audio marketplace--Napster and other companies had a great game going. They figured out how to use the Internet to give music away that they didn't own and make it into a business. Everyone was planning on getting rich there at one point. The companies that are financing and own copyrights stepped in and challenged it, and it's not a very rosy picture for them right now. I think the idea of copyright is very important--and it's respected by the courts and our government--and as people realize the potential of what the Internet with digital can do in terms of distribution, I think there's a good decision to be made that will protect the copyright...."

" Someone's going to have to recognize that once we've entered the digital world people can send out perfect copies without any costs to large numbers of people in many different territories of the world [and] can dramatically disrupt the system that we've built that allows us to produce and distribute content and pay for it and make...a profit in the investment, and that has to be addressed."

What has to be addressed? Copyright infringement is illegal. The Napster case was decided (mostly correctly) on established copyright law. There will be disruptions in distribution chains, but that is the beauty of capitalism.

Robert Heinlein said it well:

There has grown up in the minds of certain groups in this country the notion that because a man or a corporation has made a profit out of the public for a number of years , the government and the courts are charged with the duty of guaranteeing such profit in the future, even in the face of changing circumstances and contrary public interest. This strange doctrine is not supported by statute nor common law. Neither individuals nor corporations have any right to come into court and ask that the clock of history be stopped ,or turned back, for their private benefit.

- "Life-Line"

Kellner on Innovation

"I encourage innovation, and I believe that we should try to satisfy the marketplace, make it as easy and convenient for people to get what they want out of their cable subscriptions, so I'm all for that. I'm for multiplex and multiplay because in many ways it does a similar thing, and it doesn't add in the cost of VOD. It's sort of half a step in the same direction for those who don't want to take the full step, and it's something that can be done relatively quickly and easily. But I'm certainly not opposed, and I encourage the idea of exploring new models with new technology that make it better for people. At the same time, we have to make sure we don't damage the existing businesses, whether it's pay-per-view business--what does it do to that on the cable side--and that we don't damage the advertising-supported networks, cable and broadcast.

The problem with capitalism, see, is that in creating new markets you usually destroy older markets. Kellner and Hollywood just don't seem to understand that. As Copyfight put it more eloquently (Speak Softly and Carry a Big Sledgehammer), Hollywood has fallen in love with the creative and distribution possibilities of the Internet, but feel betrayed that those same possibilities will destroy many of their existing business models.

Kellner on Contracts

"I've spoken out about this a number of times. Again, it doesn't handle the deal that exists. The only payment for a lot [of content] is the willingness of the viewer to watch the spot, the commercial. That's part of the contract between the network and the viewer. For anybody to step in between that content and encourage the viewer to disregard the payment in time that he's making--I think everybody should fight those people...or let the viewer have a subscription model where they pay for that, in which case the monies can be taken in and distributed back to cover the loss of the ad revenue. This is the time to honestly address it; also, for people to deal with it. If you think it's something that's good for consumers, give them the choice of either watching the commercials or paying incremental money for the service and make sure that people in the business understand the economic damage they can do by licensing this product."

Will someone please send this man to business school? No one is forcing Turner to use their free broadcast airwaves. Turner is perfectly free to stick with subscription cable revenues. If they don't like the characteristics of a particular medium, they don't have to use it. No medium can force their readers to pay attention to advertisements (newspaper, radio, movies, etc.). What makes television different?

Kellner on how television won't change

"I don't think [PVRs] changes the way you make programming. I think it may change the way you market programming. If you have something you really, really believe in and you have a large installed base of PVRs out there, you may be willing to invest a lot more money on the launching and the marketing just to get the PVR/VOD viewer to go home and log in to receive the show because you can probably get a lot of additional viewership. If you're against tough competition, you could put a program against Friends and if there's a large PVR base you could try to pick up people who are still going to watch Friends, but will you watch the next half-hour, the next hour? You pick up People magazine and see this ad for a new show and you see a lot of promotion on the air and if it's a good enough idea maybe you go home and log in on your PVR. You may get very aggressive at promotion because you have two shots at getting people there versus one."

If I were Turner, I would seriously consider firing this guy. Of course PVRs will change the way you make programming. Fragmented special audiences require different types of production than the nearly monolithic television audiences of the past. Based on Kellner's theory, cable shouldn't have changed the way programming was made either. Formal networks are dying, and will die (unless courts or legislators change things). Even Kellner's own innovations, such as multi-casting (showing the same show more than once a week or on two or more channels), have changed the way shows are produced. Sheesh, no wonder AOL-TW stock is so depressed.

Kellner on people as means to his ends and not as ends in themselves

This is from a letter Jamie Kellner wrote to fans of Seventh Heaven , explaining that viewers are commodities to be sold to advertisers, "Selling high volumes of 18-34 adults to advertisers does not mean we aren't very excited about reaching a broader audience ..." (LUV-7H Correspondence with James Kellner) .

Additional Resources

A number of other sites have picked up on the controversy: Slashdot, of course ( Turner CEO: "PVR Users Are Thieves" ). Kuro5hin leads off its post on the subject (Turner CEO says: If you avert your eyes, you are stealing!) with a highly appropriate quote:

"...And viddy films I would. Where I was taken to, brothers, was like no cine I'd been in before. I was bound up in a straight-jacket and my gulliver was strapped to a headrest with like wires running away from it. Then they clamped like lidlocks on my eyes so I could not shut them no matter how hard I tried. It seemed a bit crazy to me, but I let them get on with what they wanted to get on with. If I was to be a free young malchick in a fortnight's time, I would put up with much in the meantime, my brothers..."

-- Alex, from A Clockwork Orange

Interestingly, AOL-TW owns part of TiVo (TiVo Partners). But, we all know that things are not going very well inside AOL-TW.

6,207 Posts
Really a non-issue. You can't enter people into a contract without informing them or even disclosing your expectations.

The bottom line is that a contract is an agreement and there isn't even an implied agreement when I receive a signal on my antenna.

5,119 Posts
Ah man... we don't get to vote which one is the most egregious?

Those Libraries and librarians must be banned. They're just givin away the goods! ;);)

(wink wink)

(but on the not-so-funny side they may attempt something along those lines)

5,119 Posts
Originally posted by toots
Can't vote. No zimbabwe or egg-beater related options.
Well ReTroll even without your vote "yes" seems to be a tough sell.

Perhaps fold it in with the egg beaters? Or just toss it overboard along with the TiVo! :D
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