Intel announced it has signed an agreement with RealNetworks to purchase approximately 190 patents and 170 patent applications worldwide, along with next-generation video codec software, for a cool $120 million. The deal fleshes out Intel's patent portfolio for streaming media to portable devices as the Santa Clara chip maker gets ready to make a serious run at the smartphone and tablet markets.
RealNetworks tried to fight the good fight against the Motion Picture Association of America (MPAA), but in the end, someone had to lose, and that someone is RealNetworks.
A U.S. District Judge has issued a permanent injunction barring RealNetworks from selling RealDVD, the company's controversial DVD copying software. In addition, the two sides reached a settlement offer that will also have RealNetworks forking over $4.5 million to the movie studios to pay for legal fees.
"We are gratified by the successful conclusion of this important matter," said Daniel Mandil, the MPAA's general counsel. "Judge Patel's rulings and this settlement affirm waht we have said from the very start of this litigation: it is illegal to bypass the copyright protections built into DVDs designed to protect movies against theft."
Pursuing the case further likely would have cost the company in excess of $10 million, no doubt a deciding factor in conceding defeat and agreeing to the settlement, no matter how much we might not like it.
"We are pleased to put this litigation behind us," said Bob Kimball, president and acting CEO for Real. "This is another step toward fulfilling our commitment to simplify our company and focus on our core businesses. Until this dispute, Real had always enjoyed a productive working relationship with Hollywood. With this litigation resolved, I hope that in the future we can find mutually beneficial ways to use Real technology to bring Hollywood's great work to consumers."
Hit the jump and post your reaction to the conclusion of this case.
Down but not out, RealNetworks said it will file an appeal and ask that a court ruling to ban sales of its DVD-copying software, RealDVD, be lifted.
The original ruling dates back to August when a federal district judge issued a preliminary injunction to halt sales of the software after film studios successfully argued that RealDVD violated copyright law. The injunction drew major interest from consumers looking for some clarification in the murky Fair Use waters.
RealNetwork's appeal only addresses the injunction, not the case itself, which, barring a resolution, is moving towards a jury trial.
"What they're going to argue is that somehow the legal basis for the injunction is wanting," said Denise Howell, an appellate and technology lawyer. "They will say that there has been an error of law somewhere along the way but they're going to try and undo the injunction. Real is facing an uphill battle."
RealNetworks continue to fight the good fight for consumers who wish to make legally backed up copies of their DVD collection, but the Seattle-based company has a tough road ahead of it.
The first bump in that road comes from U.S. District Court Judge Marilyn Hall Patel who on Tuesday ruled in favor of the movie studios and granted their request for a preliminary injunction preventing RealNetworks from selling its RealDVD software. The injunction also bars the licensing of RealDVD to set-top box makers.
"We are very pleased with the court's decision," Dan Glickman, chief executive of the MPAA, said in a statement. "This is a victory for the creators and producers of motion pictures and television shows and for the rule of law in our digital economy. Judge Patel's ruling affirms what we have known all along: RealNetworks took a license to build a DVD-player and instead made an illegal DVD-copier."
Not unexpected, the setback doesn't mean the fight is over. RealNetworks has a suit pending against the movie studios accusing them of antitrust practices.
Turning the tables on Hollywood movie studios, RealNetworks, the makers of RealDVD, has fired off a lawsuit at six major studios and the DVD Copy Control Association. The software maker contends that the studios and association are in violation of copyright law by colluding to stop consumers from making "fair use" copies of legally purchased DVDs.
"The conduct described in the claims that RealNetworks seeks leave to assert reflects a concerted and unlawful effort on the part of the Studio Defendants and the DVD CCA to eliminate competition from RealNetworks in the market for technology that enables a consumer to make a lawful, secure backup copy of DVDs that she owns," RealNetworks wrote in its filing.
RealNetworks had already filed a countersuit against the DVD CCA, and the amendment adds several major movie studios to the complaint. In the complaint, RealNetworks asks for an injunction against the industry's anticompetitive activity, as well as monetary damages for lost business, The New York Times reports.
Hot on the heels of the Pirate Bay trial, which just recently ended (not without considerable controversy), another trial is just now getting started. This one, however, involves RealNetworks and its RealDVD ripping program, a $30 piece of software that has drawn the ire of the Movie Picture Association of America (MPAA).
At the heart of the issue is RealDVD's ability to make digital copies of DVDs to a user's hard drive while still retaining the DVD-copy protection. The process even adds a further layer of DRM to the files it rips, so as far as RealNetworks is concerned, the program doesn't run afoulof the Digital Millennium Copyright Act (DMCA).
Naturally, the MPAA vehemently disagrees, even going so far as to say the software should be called StealDVD instead of RealDVD. Even more troubling for the MPAA is the RealNetworks' plan to develop DVD-saving software for manufacturers of DVD players. Facet, as it's being called, would allow Toshiba, Sony, and other companies to sell players capable of copying DVDs and save them internally. A prototype capable of storing about 70 movies has already been made, and it's expected that similar devices would sell for around $300 or less.
"The movie industry wants people to buy DVDs an so do we," said Bill Way, VP and general counsel of RealNetworks. "They have a real problem with piracy, and we are not that problem. I don't think our product will make the problem one iota bigger. I think it gives people an opportunity to make digital copies of their movies in a legal way."
Right or wrong, it will now be up to the courts to decide.
RealNetworks has temporarily suspended the sale of its RealDVD software in accordance with Judge Marilyn Hall Patel’s request. The DVD copying tool is the bone of contention between the Motion Pictures Association of America (MPAA) and RealNetworks. The two are currently locked in a legal battle.
The case will come up for hearing in the U.S. District Court in San Francisco on Tuesday. Judge Marilyn Hall Patel will be hearing the matter. Although most MPC readers are in favor of DVD copying, they have very little sympathy for RealDVD due to its encryption features and $30 price tag.
Although RealNetworks downplayed any legal perils while announcing its DVD copying software last month, the major film studios have acted in the most obvious manner possible by suing the software company.
In the eye of the storm lies RealNetworks’ DVD copying tool called ReadDVD that allows users to make digital copies of their DVDs on their internal or external hard drives. However, the Motion Pictures Association of America (MPAA) hasn’t taken a liking to the tool. The MPAA has dragged RealNetworks to court over RealDVD and is praying for a temporary restraining order against the sale of the software.
Greg Goeckner, executive vice president of MPAA, quipped that the software be called StealDVD instead of RealDVD. However, RealNetworks feels that the software can not be used for piracy as it encrypts the digital copies in such a manner that they can’t be shared.
RealNetworks is soon going to tread the perilous waters of DVD copying. The company has announced that it is going to release RealDVD, an application for making digital copies of DVDs. Although DVD copying applications have been available for long, RealDVD will be the first such tool to be released by a major company.
RealNetworks is fully convinced that there won't be a strong case against it, if the company is ever dragged to court over the software. RealDVD will come with certain restrictions to prevent its use for piracy. "We have put in significant barriers so people don't just take this and put it on peer-to-peer networks," RealNetwork's Robert Glaser told NYT. However, he did not spill the beans on the exact nature of the curbs. RealDVD will carry a $30 price tag.
Here is a bit of news that might have music lovers rhapsodic. RealNetworks-owned online music service Rhapsody has MP3 music sans any Digital Rights Management (DRM) protection. This entails that users can do anything with the music they buy. If you thought that piracy fearing labels would never back such an initiative then you were wrong.
Major labels will continue to make their music available through Rhapsody. They perceive DRM protection to be some sort of a sales impediment as it deters many music lovers from buying such music online – scarecrow effect. Rhapsody’s online music store offers a single song download for $.99 and an entire album for $9.99. Rhapsody has certainly taken the attack to iTunes.