RealNetworks and the MPAA Clash over RealDVD

RealNetworks labels it a tool to “protect your discs from scratches and damage,” while the MPAA blasts it as "StealDVD," a method to "rent and rip" DVDs from retailers like Blockbuster and Netflix.

Tuesday, the Motion Picture Association of America and RealNetworks (RNWK) went at it head on, taking each other to court in separate lawsuits. There may have been an effort at behind the scenes diplomacy but there was no shot across the bow, no public warning. The fight came quick and fast with preemptive and counter strikes. 

The battleground is RealNetworks' newly released realDVD software, a software program designed to copy DVDs. The question is whether it’s legal and how copyright law should be applied to its use.

The undisputed fact is that RealDVD enables consumers to create digital to digital archival copies of DVDs. These files are then stored on a computer and available for viewing without the need of the disc.

In an homage to “Fair Use,” RealNetworks says this software is a way to “protect your discs from scratches and damage.” Playback is handled on a proprietary player. The whole package is being sold for an introductory price of $29.99 a copy ($49.99 retail). Their advertising copy says you can “save your movies legally, and with confidence.”  Their filing cites supporting case law.

The collection of studios and content owners jointly represented by the MPAA vehemently disagrees. The MPAA alleges the software is a violation of the Digital Millennium Copyright Act which explicitly prohibits the circumvention of a digital copyright mechanism. They also claim that RealNetworks “misuses a limited license [Real Networks] obtained to make authorized DVD products.” 

Greg Goeckner, Executive Vice President and General Counsel for the MPAA writes:

RealNetworks’ RealDVD should be called StealDVD. RealNetworks knows its product violates the law and undermines the hard-won trust that has been growing between America’s movie makers and the technology community. The major motion picture studios have been making major investments in technologies that allow people to access entertainment in a variety of new and legal ways. This includes online video-on-demand, download-to-own, as well as legitimate digital copies for storage and use on computers and portable devices that are increasingly being made available on or with DVDs. Our industry will continue on this path because it gives consumers greater choices than ever. However, we will vigorously defend our right to stop companies from bringing products to market that mislead consumers and clearly violate the law.

RealNetworks, which filed its suit first to seek a preemptive judicial ruling, counters that the software doesn’t break, or bypass, encryption. In fact, it copies and maintains the CSS encryption.

From the filing:

When RealDVD software is used to make a personal copy of a DVD, it not only preserves the Content Scramble System [CSS] encryption the Studio Defendants use to encrypt DVDs, but also incorporates additional levels of protection.

Despite the fact that a California court concluded over a year ago that the same type of copying methodology employed by RealDVD does not violate the CSS License agreement, the Studio Defendants, on their own behalf and on behalf of the DVD CCA, nonetheless have asserted that the RealDVD system violates the CSS License Agreement and the anti-circumvention provisions of the DMCA.

The courts could be mulling this case for a while. In the occasional quagmire that is copyright law, the outcome could set some interesting precedents. This will be a case to watch.

Stay tuned.