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Flagged for Interference

Tedstevens The Senate Commerce Committee approved a bill yesterday by Chairman Ted Stevens (R-Alaska, pictured at left) to make it easier for AT&T, Verizon and other phone companies to offer television service through their high-speed Internet lines. But the favors offered by the bill don’t end with the telcos; the entertainment industry got its share of goodies, too.

Here’s just one example. The measure would require consumer-electronics and tech companies to alter their products to deter users from redistributing digital TV broadcasts over the Internet. This “broadcast flag” requirement is similar to an FCC mandate that an appeals court struck down last year on technical grounds. The requirement, which will have the most pronounced effects on entertainment-oriented home networks and computers, was pushed hard by Hollywood as a critical protection against a type of piracy that does not yet exist – and may not be seen for quite some time. The studios worry about high-definition programs being bootlegged online, but the obvious protection there is the enormous amount of data involved. As broadcast, 30 minutes of high-definition video consumes as much as 34 gigabytes of data. Even if you compress the broadcast aggressively, you still need upwards of 2 gigabytes of data. Think about trying to upload that through a broadband pipe with a 256 Kbps limit – you’d have to fill the pipe for more than 17 hours. (Even using a relatively fast, 1.5 Mbps DSL connection to download the thing would require 3 hours.) Now imagine doing that for a two-hour movie.

The studios’ concern about Internet piracy is understandable, given that just about everything they produce for TV these days gets bootlegged online (albeit not in high-def). Still, over-the-air television is an advertiser-supported medium. The business is all about encouraging people to watch a show, not trying to limit the audience. Granted, TV aims for national or regional audiences, and bootleggers share files globally. Still, you have to think that ABC's experiment with free, advertiser supported TV-on-demand online provide a better response to the threat of online piracy than the broadcast flag.

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Times editorial writer Jon Healey pens opinion pieces about a variety of business issues, and blogs about technologies that are changing the entertainment industry's business model.

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