WASHINGTON D.C. - In the recent suit initiated by content companies against Cablevision for their "centralized DVR" offering, the defense of fair use does not apply, states James V. DeLong in "(Cable) Vision or Delusion?," a new Progress on Point released today by The Progress & Freedom Foundation. In the paper, DeLong, PFF Senior Fellow and Director of the Center for the Study of Digital Property, disputes the common assumption that time shifting of a work is always covered under fair use. Instead, the Sony U.S. Supreme Court decision involved a very specific set of circumstances that don't necessarily apply in the way some believe to today's technology.

At issue in the suit between Cablevision and content providers is whether a centralized DVR offering is covered under existing transmission licensing arrangements. While the cable provider is claiming it is assisting viewers in exercising fair use rights, the content providers contend that fair use cannot be asserted by a third party, especially for financial gain. DeLong concludes that the Supreme Court's Sony decision deeming time shifting as fair use "contains much less support for home recording practices than is commonly assumed, and that in fact the level of protection the case affords to current technologies is, as a matter of legal logic, close to zero."

In his paper, DeLong looks specifically at the fair use ruling in the Sony decision, which was a departure from existing premises of fair use that emphasized a transformation of the original work. In the case of the VCR, the Court determined that in the case of single-view time shifting, no harm was being inflicted on the content companies. However, DeLong notes the decision was based on the broadcast television market where advertisers, not the viewers have a direct relationship with the content provider. Today, over-the-air broadcasting is being replaced by subscription based and pay-per-view services. Also, DeLong explains, the technology available at the time of the decision did not allow one to make infinite numbers of perfect copies and to subsequently distribute the digital content. Therefore, DeLong urges acknowledgment of the decision as "practical compromise with reality, not as a fundamental principle to be extended."

The author concludes that any long-term solution to "fair use" and time shifting in the future will include digital rights management. DeLong explains that "any revisit of Sony should recognize the potential impact of digital rights management. If the content owner chooses to make a program unrecordable, this decision should be honored, especially if it is made in the context of moving to a video-on demand system, or to a system that distinguishes between viewing and capture, and allows the content creators to monetize these differences."

The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.