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New Cops on the Online Video Beat

A bill that would crack down on illegal streaming was drawing a lot of attention in Washington right before the election break. It’s understandable: The future of video delivery is riding on serving up TV- and Web-original content online.

Protecting that content, says Daniel Castro, senior analyst for the think tank Information Technology & Innovation Foundation, “is the difference between [broadcasters] being able to charge for content and not. If they want to have a business model, something like this [bill] needs to happen.”

The bill could take a bite out of online crime, though some content providers are concerned it might give ISPs too much power.

Introduced by Sen. Patrick Leahy (D-Vt.), chairman of the Judiciary Committee, the legislation would give the Justice Department more power to pull the plug on U.S. Websites it found to be offering “infringing content” by allowing it to shut down the domain names of those suspects.

But sources on both sides of the bill say the latest version would permit ISPs or ad networks doing business with suspected infringers to pull the plug without fear of breach of contract.

Studios, broadcasters and various unions support the bill as a new weapon in their battle against copyright infringement. There is, however, some concern in the ad community that giving ISPs or ad networks policing power is the wrong way to go.

Ted Utz, managing director of Petry Digital, which sells ads for TV station Websites in the majority of markets, says that it doesn’t make sense for ISPs to be responsible for policing the content on potentially infringing Websites “so far removed from their core business.” He says it’s important to protect content wherever it appears, but that the Justice Department should make that call.

As to protecting clients ad networks represent from having their brands associated with pirated content, Utz agrees it’s an issue, but adds that advertisers are increasingly concerned about where their content is placed and already have stringent requirements.

Castro agrees it would be better to leave identifi cation of offending sites to Justice. “Having the attorney general do it takes the onus off individual companies for having to decide what is good and what is bad,” he says.

Putting a sharper point on the threat of controlling potentially pirated content came with the emergence last month of a couple of online streaming sites carrying broadcast TV channels without individual payment for either the privilege (as broadcasters view it) or the right (as the companies view it) of carriage.

Currently, video sites Ivi TV and FilmOn are streaming TV-station signals as part of online pay video packages. Their defense is that they are online multichannel video providers much like cable operators—at least when it comes to copyright law allowing the retransmission of local TV signals essentially for free, but not subject to the retransmission consent regime that requires negotiating individually with broadcasters for local signals.

The Big Four Networks and their studios have sued both sites, arguing they are doing “irreparable harm.”

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