FCC Clears Way for Studios to Deliver First-Run Films to Homes

Approves a request from the MPAA to allow shutting off secondary outputs on TV, cable or satellite boxes

Last Updated: May 10, 2010 @ 1:00 PM

MPAA-member studios received a key FCC ruling Friday, allowing them to control the inputs of consumer home entertainment devices, and thus digitally pipe movies into the home while they’re still in theaters.

Approving a request by the Motion Picture Association of America, the Federal Commications Commission gave Hollywood studios a waiver on laws governing "selectable output technology."

The FCC essentially gave MPAA member studios the legal ability to turn off any secondary outputs on TVs, satellite or cable boxes during the viewing of any film not yet available on DVD. This will enable studios to digitally send newly released movies into homes with less fear of piracy.

Major studios including Sony Pictures are looking to establish a digital home window for their films concufrent to or narrowly following their theatrical release, and this ruling enables them to do so without consumers using their home entertainment equipment to rampantly make illegal copies.

In issuing its ruling, the FCC rejected objections from the National Association of Theatre Owners and the Independent Film and Television Alliance, which argued that the move would “deprive consumers of valuable cultural resources,” “reduce access to independently produced films” and threaten the future of “sleepers” being developed.

“We conclude that the service that MPAA proposes would serve the public,” the Media Bureau said in announcing its decision.

The FCC gave the go-ahead to turning off the output for 90 days, or until a film became available on DVD.

It said it agreed to the request because it didn’t see any likelihood studios would ever offer the movies otherwise. It said it would review the results of its move in two years.

“We are convinced that MPAA member companies will not make any substantial changes to the release window in the absence of adequate protection of high-value content, and that consumers will thus not enjoy the benefits of this service absent a waiver,” the commission said.

It made one other addition. While MPAA sought the change on behalf of its six studios, it decided independents and other studios will get the same opportunity.

“We see no public interest justification for limiting the waiver to MPAA member companies and their partners,” the agency said.

The MPAA in a statement praised the decision.

“This action is an important victory for consumers who will now have far greater access to see recent high-definition movies in their homes,” said Bob Pisano, the MPAA’s president and interim CEO.
“And it is a major step forward in the development of new business models by the motion picture industry to respond to growing consumer demand.”
For now, with the ruling posing only an indirect threat to their well-guarded release windows, the movie exhibition community seems to be reserving judgment, with its representative body, the National Association of Theater Owners releasing only a brief, rather vague statement Friday.

"The FCC’s decision is not surprising," the trade group said. "Movie theft is a serious problem. The issue of the theatrical release window, however, will be decided in the marketplace."

Consumer group Public Knowledge complained that the consumers, not the MPAA, should decide how to set up their TV and warned the MPAA’s request could wreak havoc, making it difficult for many consumers to see the films on their home TV setup.
It also warned that the restriction was open-ended and impact consumers’ ability to ever view films that don’t go to DVD quickly or at all.

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