Viacom v. Cablevision - Bring it On (Finally)!
Michael Greeson,Founding Partner, Research
April 15, 2011
As reported previously, cable networks are not at all pleased with the new crop of iPad apps that permit PayTV operators to stream live TV to iPads, this despite the fact that (1) users must first subscribe to and pay for access to said content as part of their home TV service, and (2) 'TV Everywhere' initiatives undertaken by operators permit access to on-demand and (in some cases) live TV on virtually any net-connected video device (including Macs and iPhones). The issue is whether or not the content owners believe their rights are represented across each of the various conduits of quantum video delivery.
According to Viacom and other content owners, extending live TV access to iPads (even if only in the home) violates a rule that other platforms do not (at least not such that they are worthy of formal complaints and even lawsuits). This concern caused Time Warner Cable to remove specific Viacom channels for its iPad service, but Cablevision has yet to budge. Any Viacom served up through a Cablevision TV set-top box is also available to iPad users.
It's not that these apps permit video vagabonds free access to Viacom's treasured content. Both apps require authentication, meaning in order to enjoy this content on an iPad one must first subscribe to the channel in question and be able to prove it.
If true, why, then, would a PayTV operator care if the enabling device is an iPad as opposed to any other net-connected device that resides in the home? Why should this make any difference, much less comprise a legally rational distinction?
The reasoning for Viacom's objection can be summarized as follows: distribution to tablets is a special case and represents a breach of contract and copyright, violating the "fair licensing agreements that provide appropriate value for everyone involved." But it gets worse.
As reported in The Wall Street Journal, Viacom argues, "Cablevision has seized distribution rights that Viacom has not granted. Viacom grants rights to distribute our content based on specific technologies and devices."
Is Viacom claiming that accessing its live content on an iPad (a "specific" device) using a broadband network (a "specific" technology) while in the home (a zone where live TV is licensed to be enjoyed) is a usage case so specific and unusual that it demands separate "appropriate value" discussions?
Cablevision responded as appropriate (pun intended), that "programmers are paid based on how many homes we securely connect to their content, not how many televisions display it," meaning PayTV operators see the iPad as just another television screen (a correct view to everyone in the broadband video industry except - you guessed it - the content oligarchy). The question is whether iPad distribution has some unique legal status such that special carriage agreements are required (i.e., "special" as in "different from other Internet-connected video displays" that seem to be covered by existing agreements).
While Viacom has not (yet) sent a cease-and-desist letter to Cablevision (as it has with Time Warner Cable, which was elevated to the level of lawsuit just last week), we all know where this is headed, and neither the operators nor networks seem to mind - and nor do we. This issue has been simmering for years and it's time it was brought to a head.
Oh, this is going to be fun!
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