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DVRs and video on demand in Australia

At a time when hot words or concepts include IPTV, Internet Television, Web TV, digital broadcasting and video-on-demand, this post sets out statistics and observations on the growing Australian digital video recorder (DVR) market.

In today's issue of The Australian Financial Review, Neil Shoebridge's excellent article, Seven and TiVo in distribution link, sets out statistics and observations on the growing Australian digital video recorder (DVR) market.

This data is timely as all things video are hot topics in Australia and overseas. This is at a time when hot words or concepts include IPTV, Internet Television, Web TV, digital broadcasting and video-on-demand. See for example Lost Remote which has an interesting Archive section with articles relevant to IPTV.

Broadly defined, involved in these markets are US Internet ventures such as YouTube, Apple, Joost and Blinkx.

In Australia there are start-ups such as Vquence. In the race to sell digital set-top boxes for video-on-demand, there is RealTime Media, which is in competition with similar offerings out or coming from Foxtel and Video Ezy / Mobilesoft. Also involved in video-on-demand are Telstra's BigPond Movies and IceTV.

As for DVRs in Australia, they are already offered from Topfield, Beyonwiz and IceTV. Now TiVo is to join the competition.

Australian digital recorder market

Shoebridge writes:tivo

  • "Kerry Stokes' Seven Network ... announced yesterday it would start selling TiVo devices [pictured right] in Australia and New Zealand next year. ...
  • At present DVRs ... are found in about 320,000 of Australia's 7.8 million homes. That number includes the 200,000 subscribers to pay TV operator Foxtel who have bought its iQ DVR. ....
  • Seven will sell the TiVo device and monthly subscriptions. The latter will give people access to the electronic program guide, which is a critical part of a DVR. ...
  • PBL Media's Nine Network is suing the DVR company, IceTV, over unauthorised use of its program schedule in the Ice electronic program guide. [Seven commercial director] ... Mr McWilliam said Seven was negotiating with industry group Free TV Australia about getting access to all free-to-air TV networks' program guides. TiVo would also be connected to content from Seven's Yahoo!7 and other Internet companies.
  • TiVo would not be linked to Foxtel or regional pay TV company Austar, which will launch a DRV in August.
  • DVRs have found their way into 17.2% of homes in the US. According to a survey by the CBS TV network, about 90% of Americans who own a DVR say they fast-forward some or all commercials. Another survey by Millward Brown, found there was no link between owning a DVR and reduced awareness of ads.
  • [Seven director of digital media Rohan Lund said] "TV viewing is 20 to 25% higher in DVR households."

Seven's distribution deal for TiVo falls in line with other signs of favourable market sentiment for video. On the supply side there is the wisdom of the M&A crowd's stampede as discussed in  Billions made with Internet venture exit strategies. On the demand side there is confirmation in a recent survey regarding the very high regard consumers have for communications gizmos - see , "Silver surfers riding the online banking wave".

Copyright in electronic program guides

Success in the DVR market will depend on the legal, structural, financial and other negotiation posititioning of Topfield, Beyonwiz and IceTV negotiate.

For all DVR platforms a critical requirement is clear legal rights over electronic program guides. These guides are available from television networks - channels Seven, Nine, Ten. ABC Television and SBS. There are a line of copyright cases which protect such mundane lists of facts as are found on telephone directories, betting cards and sporting fixture dates and venues. Guides are likely to be treated similarly, though that may be soon tested in Australia. Following the US Supreme Court decision in Feist Publications, Inc., v Rural Telephone Service Co., 499 U.S. 340 (1991), the relevant copyright law favours copyright users in the US whereas it favours copyright owners or holders in Australia.

san-francisco_chronicle

From triple play to quad play

Those who seek to play in these video markets are currently busy securing positions. They include telcos offering so-called triple play services - television, broadband Internet and home phone service all in one package and all under one bill. There is even talk of "quad play" when the phone service provides mobile or cell telephony. For more on that see the San Francisco Chronicle article, Triple play not enough? Say hey to quad play.

New client projects at Dilanchian

As things hot up, at Dilanchian we are currently working on projects for clients in such activities as:

  • assessing the application of content regulations and other law to new video ventures, eg under the Telecommunications Act 1997 (Cth), Broadcasting Services Act 1992 (Cth) and Classification (Publications, Films and Computer Games) Act 1995;
  • IP licensing contracts providing content for digital ventures (eg Joost) which need to attract eyeballs - keeping in mind fair dealing and other provisions in the Copyright Act 1968 (Cth);
  • business structuring legals to develop businesses based on IPTV to serve niche markets - involving shareholder agreements, preparation of standard agreements for end users, sponsorship agreements and other venture startp-up work; and
  • IP strategy and commercialisation work for locally-designed products that offer triple play - including considering patent and trade mark registration and developing effective documents and contracts for employees involved in creating intellectual property. This includes preparing legally effective restraint of trade (ie non-competition) clauses.

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