Zediva thought it had things all figured out. Allow users to rent a DVD player in a data center someplace with a hot new release movie in the slot, then stream them the output from the DVD player. Zediva claimed that was no different than the consumer renting the disc themselves. The courts didn’t agree and have now upheld a preliminary injunction and shut Zediva down for good. The company has also been ordered to pay the MPAA $1.8 million.
The judge in the case ruled on Friday that Zediva had not, in fact, found a loophole in copyright law that would allow them to stream any film in existence. Zediva never acquired streaming licenses, which Hollywood is famously reluctant to issue. By skipping the licensing deals, the company was able to charge just $1.99 per rental.
Certainly Zediva had to expect a legal challenge, but the service had barely gotten off the ground before it was cut down, and now the judgement is permanent. Did you ever use Zediva? is this a great loss for the internet, or just another hair-brained scheme down the tubes?