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Score another one for Hollywood versus the Internet. A dozen major Hollywood movie studios succeeded Monday in beating back online VCR startup RecordTV.com, an Agoura Hills, Calif.-based company they sued for copyright infringement in June. Under an agreement between the two parties, RecordTV is no longer allowed to stream the studios’ programming, and the company now must pay the studios $50,000 in legal fees. The settlement, which basically spells the death of RecordTV, marks Hollywood’s third win in online copyright infringement cases in less than a year. In July, a New York federal court ruled that the decryption code DeCSS was an illegal, copyright-infringing means of viewing DVDs. Then last fall, peer-to-peer entertainment site Scour was basically forced to shut down due to mounting legal fees associated with a copyright infringement suit similar to the one filed against RecordTV.com. “The lawsuit made it impossible to move forward or raise money,” said RecordTV founder David Simon, adding, “I’m relieved.” Initially set up by Simon as a means to record TV shows for his kids, RecordTV was little more than a makeshift operation. Other audiences eventually found their way to the RecordTV site and began requesting recordings of other television programming, so Simon ended up rigging his computer to pull the shows off his local cable system and making them available online by request. But as RecordTV was gaining popularity, Hollywood was wising up to its own rights in cyberspace. “This shows that studios do pay attention, do care about copyright and will prosecute,” said Robert Schwartz, head of the entertainment practice at Los Angeles-based O’Melveny & Myers, which represented the studios. Even as Schwartz claims victory for the studios, however, the online distribution of entertainment is taking off. Consumers will no doubt clamor for more services like the one offered by RecordTV as broadband Internet service becomes more available and options for online entertainment shrink. “It’s a bad precedent,” Simon said of Monday’s settlement. “This is going to set [online distribution of entertainment programming] back a few years. At some point, people are going to want to watch TV on the Internet. Someone else is going to have to fight that fight.” But Schwartz maintains that no one else will have to, now that all of the Hollywood studios are either looking to partner with existing video-on-demand services or launch their own within the year. Copyright � 2001 The Industry Standard

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