News Corp. Shuts Off Hulu Access To Cablevision

ideonexus writes "Normally when we advocate Net Neutrality, we are talking about preventing ISPs from discriminating against content providers, but in this case, the content provider is discriminating against the ISP. Is this a new dimension in the Net Neutrality fight? From the article: 'Cablevision internet customers lost access to Fox.com and Fox programming on Hulu for a time Saturday afternoon — the result of a misguided effort on News Corp.'s part to cut off online viewing as an alternative in its standoff with the cable operator over retrans fees. Fox stations in NYC, Philadelphia, and New Jersey went dark at midnight Friday when negotiations between the two broke down.'"

Comments

Oblig.

[negRo_slim]

And nothing of value was lost...

Re:Oblig.

[betterunixthanunix]

Hey now, Fox has, in the past, had decent programming; Firefly comes to mind. Of course, Fox also has a habit of killing off cool series, though I guess withholding access to their entire network from millions of people is a new level entirely.

Re:Oblig.

[hedwards]

Yes, and whenever they find themselves in the odd position of having genuinely engaging material, they cancel it as soon as they can. Or they put it in a bad time slot, like after sporting events or move it all over the schedule.

Quality programming for them is pretty much accidental and a failing on the part of the execs to properly kill it.

Re:Oblig.

[FoolishOwl]

One explanation of Firefly I'd heard was that, while Fox didn't like Joss Whedon, they knew he was too good to allow the competition to have him. So they got him on contract, then ran the show in a terrible slot for its demographic, messed up the order of episodes, and generally, did everything they could to submerge the show without outright killing it.

Re:Oblig.

[Bill_the_Engineer]

Would a corporation sacrifice profit to screw with Joss? No. It was an incompetent TV exec that wanted to give priority to shows appealing to the female tween market. Just look at the line up now from all the networks except for CBS and NBC. How many vampire or metro-sexual 90210 wannabes do we have to have?

Tweens rule the broadcast market...

Re:Oblig.

[bhtooefr]

Except it wasn't the ISP that did it. They're allowing full access to Hulu.

It was Fox, who runs Hulu, because another division of the ISP rejected a rate increase from Fox.

In this case, you're arguing for being unable to drop China at the firewall protecting your web server, for instance - that would violate your definition of net neutrality.

Alternately, the only other way that would work is that literally everyone that wants to get paid for access gets paid what they want to get paid, and if you don't pay someone, you get shut down. That's a disgusting thought.

Real net neutrality means that you can access any site without your ISP blocking or slowing down access, and there's no signs that that's been breached here, as Cablevision isn't blocking Hulu for Cablevision customers, HULU is blocking Hulu for Cablevision customers.

But of course....

[cpux]

The Fox content at Hulu was restored when they realized they didn't have the capability to block only Cablevision customers in the area. All of the NY/Philly area was blacked out, when their beef is only with one ISP.

Re:But of course....

[pavon]

Did they really do that? Idiots. It isn't hard to get a list of IP blocks allocated an ISP.

To me this brings up another example of how the general idea of net neutrality is simple, while the details are not. Most of us would agree that this behavior is anti-competitive, but where do you draw the line? Many sites block entire countries, because they don't have the legal right to serve the same content in all regions. Many sites ban entire countries or IP blocks due to spamming and/or other malicious behavior that has come from those blocks. Is that acceptable? If so, given that you can find malicious behavior coming just about every IP block (botnets), does that mean that it could be used an excuse to ban whoever you wish?

Re:But of course....

[Jeff DeMaagd]

Don't abuse the racism charge, lest it gets watered down and becomes worthless.

Hulu blocking other countries is a business decision. They don't have the distribution rights to transmit overseas, and they don't have an infrastructure to sell ads appropriate for overseas customers. There's no reason to show most US ads to non-US people.

To call this tantamount to racism is really twisted in my opinion. There's no reason to ask them to deliberately lose money to fulfill your sense of justice, especially over an entertainment medium.

Re:But of course....

[TubeSteak]

Most of us would agree that this behavior is anti-competitive, but where do you draw the line? Many sites block entire countries, because they don't have the legal right to serve the same content in all regions. Many sites ban entire countries or IP blocks due to spamming and/or other malicious behavior that has come from those blocks. Is that acceptable?

The line is drawn at anticompetitive behavior.
Leveraging your power in one market in order to influence a related market is anticompetitive and it's what Fox just did.

Not having [regional] rights to air something & banning malicious network blocks are completely unrelated.

Re:But of course....

[aardvarkjoe]

Don't abuse the racism charge, lest it gets watered down and becomes worthless.

If you don't think it already is, you haven't been paying attention for the last twenty years.

Re:But of course....

[Alsee]

Many sites block entire countries, because they don't have the legal right to serve the same content in all regions.

Note that we should not confuse copyright with idiotic contract terms attempting to manufacture a licensing model.

Obviously a website (or a TV broadcast antenna, or a book manufacturer) has to obey copyright law at that location. Obviously they have to license any relevant copying or distribution rights, at that location.

The website *is* licensed to serve the content. The issue is contracts that require websites to block IP address ranges in some warped attempt to simulate licensing of the person at the other end.

A TV show can license a TV broadcast antenna that happens to be in the US, but there is nothing "regional" about licensing. The copyright holder is not licensing the people who receive it, he is licensing the broadcast antenna. Someone in Canada does not need any license at all to turn his TV to that channel and receive it. The most the copyright holder can do is get the antenna station to sign a contract promising to point the antenna away from Canada. There is nothing "regional" about any of the the copyright licensing itself. The station has the licensed right to transmit. If someone in Canada, or even Japan, has a really good TV set and can pick up the signal that is not a violation of any license.

A book author can license a book manufacturer who happens to be in the US, but there is nothing "regional" about licensing. The copyright holder isn't giving any sort of license for "regional readers". The copyright holder is not giving any license at all to any readers, because under copyright law there is no such thing as a license to read. People without licenses can just plain read, regardless of any permission the copyright holder wants to grant or deny. The most the book author can do is get the book manufacturer to sign a contract promising not to willfully mail the book out of the US themselves. The manufacturer is licensed to print copies. There is no license violation if someone in Japan buys the book secondhand from someone in the US and reads it. The person reading the book in Japan doesn't involve any sort of "regional licensing" because they don't need any license at all to read it.

The same goes for websites. A copyright holder can ask the website to sign a contract promising to block various IP-ranges, but is just an effort to manufacture or simulate some sort of regional idea. Aside from the contractual promise to block certain IP addresses there is nothing actually regional about any of the copyright or licensing. And is is false and stupid to try to use IP addresses in that manner. Yes, IP addresses are usually pretty accurate at telling you were the other end is located, but it is a grossly flawed assumption. Hopefully the increase of proxies and advancing internet technology will make it increasingly obvious that an IP address is not a location, and that trying to us IP addresses to limit websites to national borders is impossible and stupid.

-

Access Denied to Fox?

[Torinir]

I don't know... I think that denying access to Fox's website and Hulu feed could be considered a public service, but that's just my opinion.

Re:Access Denied to Fox?

[hedwards]

You have a point, however, there is a bit of this which is definitely public service. It demonstrates to a couple significant markets and several ISPs that a lack of net neutrality can hurt them as well.

Re:Access Denied to Fox?

[DMUTPeregrine]

This isn't censorship. If Cablevision or Hulu had blocked fox, THAT would be censorship. Fox stopped broadcasting.The effect may be the same, but no one blocked anything.

Not exactly...

[DeadDecoy]

In this case, the owner of the content are deciding where/how they want it hosted versus net neutrality where ISPs can potentially act as the gate keepers to content and charge a toll for those accessing and those supplying content. The difference is that the latter prevents a neutral ground for competing or simply posting information up.

Not a new dimension

[betterunixthanunix]

ESPN already does this, and we have already criticized them for it.

Re:Not a new dimension

[mrsteveman1]

Web sites aren't "channels". If we let them get away with turning the internet into another fucking channel lineup of large websites, all of humanity is fucked.

We'll know nine months later what the effect was

[PatPending]

No TV? No Internet? What are we gonna do?

The effect of this will be manifested about nine months later...

Re:Net Neutraility?

[betterunixthanunix]

using the government to force private businesses

use government to force individuals

How many times do we have to go over this? Look, I'll make it simple for you: businesses != individuals.

Torrents

[dark42]

I think this is a really stupid move on the part of News Corp, now they're just gonna deprive themselves of the advertising revenue that Cablevision customers brought to Hulu. Meanwhile, torrents still exist, and the downloaded shows tend to have the ads cut out...

Not *network* neutrality

[klapaucjusz]

Network neutrality is about the network being neutral w.r.t. the content it carries.

This is about content providers being neutral, not about network neutrality. Please do not try to confuse the network neutrality discussion by mixing it up with other, unrelated debates.

Re:Not *network* neutrality

[dachshund]

Don't be fooled by the apparent dissimilarity of the two problems. At a fundamental level they're very much related. You have large, entrenched organizations that own content and, in some cases run broadband networks -- facing off against large entrenched organizations that own broadband networks and, in some cases, produce content. The two nearly identical sides are running an experiment, trying to use their market power to try to force each other into favorable business terms.

In both cases the customers are being treated like an asset to be sold, or held hostage, while the corporations use them as a bargaining chip in their real business decisions. Sure, the negotiations can go either direction, but eventually it's the smaller players who are going to get locked out of the game.

In fact, this kind of thing is directly related to the net neutrality argument, because it presents a terrific counterargument for the ISPs. If the ISPs are required to be neutral, but the content providers aren't, then we're essentially going to take away one of the ISPs only weapons in what is really a two-sided business war. I don't love this argument, but I believe it could be persuasive.

At very least you need to understand this as one skirmish in a much broader conflict.

News Corp/Fox is out of control

[Brad1138]

I work in the satellite dish industry. We are dealing with and fairly informed on the News Corp/Dish Network dispute. On the CableVision side, News Corp is trying to raise their rates from $70 mil to $150 mil, over a 100% increase. With Dish Network, they are trying to force Dish to include the Fox Sports regional networks into the lowest package, which would raise that package $5/month ($40 to $45). News Corp is trying to tell Dish how to run their business. There are plenty of people that don't care about sports and don't want to pay the extra money for it. The reason News Corp wants their Sports channels in the lowest package is to increase (the perceived) viewership numbers so they can raise their advertising rates.

A lot of the Dish Net/Cablevision customer won't see beyond "my channels are gone" and switch to a different provider. That is exactly the wrong thing to do. Dish Net/Cablevision are fighting to keep our rates down, but they can't do it if everybody jumps ship. Dish won the recent battle against Fisher Communications, they were trying to raise their rates 78% for over the air, tax payer subsidized "free" channels. Fisher Communications was already the highest paid among their piers, and wanted to nearly double their rates.

Re:News Corp/Fox is out of control

[betterunixthanunix]

Ironically, videos delivered over the Internet should be rescuing us from this sort of behavior -- we should not have to worry about two large corporations that we really have no say in the conduct of getting into a spat and suddenly making videos inaccessible to us. Of course, we are, once again, relying on large corporations (Youtube, Hulu) whose conduct we have no say over to provide us with our videos...

Re:News Corp/Fox is out of control

[nametaken]

...and switch to a different provider. That is exactly the wrong thing to do. Dish Net/Cablevision are fighting to keep our rates down, but they can't do it if everybody jumps ship.

No doubt most of the people here understand what you're saying and agree entirely. Unfortunately, I'd guess News Corp knows that any strategy that depends on regular people being informed or showing some kind of conviction is a lost cause. That sucks. :(

Re:News Corp/Fox is out of control

[xda]

I've worked for some cable companies and had this explained to me a few times, so I know it to be true. Cable companies even ask their employees to write letters to content providers asking them not to hike their fees.

I think cable companies have it worse than Dish because they have to pay fees on "homes past", meaning they are paying a fee for every home that could potentially subscribe to the content. I've been told by multiple people "half your cable bill is ESPN, whether you wanted it or not".

Cable companies have been trying to move to a la carte style where you only pay for channels you want... but they have been getting blocked by ESPN and others threatening to pull out. Cable company with no ESPN isn't going to work. I've talked to some upper management types at these companies and they claim if it wasn't for pay-per-view / on demand, they wouldn't be making any money. I doubt that though.

Re:News Corp/Fox is out of control

[Bill_the_Engineer]

Unfortunately, I'd guess News Corp knows that any strategy that depends on regular people being informed or showing some kind of conviction is a lost cause.

Which explains why News Corp target the totally uninformed and easily swayed demographic...

Re:Net Neutraility?

[Beelzebud]

Being a private business does not give you a blank check to ignore laws and regulations set by the government.

Don't like it? GTFO.

Solution

[amaiman]

My solution:

1) Cancel my Cablevision TV service (their rates are way too high anyway). I've been thinking about it for a while, and I think this latest dispute is the last straw.
2) Connect antenna to TV.
3) Watch FOX.
4) No profit for either of them.

I can buy all of the shows that I want to watch from iTunes or Amazon and still come out way cheaper than my current cable TV bill. And that's ignoring the "torrent" option that many people will choice to use instead...

Re:Net Neutraility?

[Aquitaine]

My business is just me (technically) plus a few contractors. At what point are we and our interests no longer individuals? When I hire my first full-time employee? My tenth? My twentieth?

As a disregarded entity (the technical term for 'I pay personal income tax on everything rather than corporate taxes') there is a lot of co-mingling between my personal funds and my business, mostly because I can wave my hand and decide to pay myself whenever I want, since I have to pay income tax on all of it anyway. Should I be restricted from spending some or all of that money on political contributions or PACs?

Obviously, the larger my business gets, the more likely its interests will start diverging (or at least running parallel as a separate entity) to my personal interests, but that's perfectly normal. I still have to earn money, and once I've earned that money, why should anyone other than me decide what causes I can support with it?

Re:Who are the good guys?

[WillDraven]

It's the same with all cartels, be they drugs, media, or internet service: the true bad guy is the government for failing to properly regulate the market.

Predicted Path

[Bob9113]

This is what I have believed is the path this matter will take, and I (and probably many others) have been arguing exactly this. The following is the rational path:

Big ISP threatens big content. Big content counter-threatens big ISP. Big ISP and big content reach an agreement to shut out small competition. General public does not know about or care about small competition. Small competition dies, oligarchs win.

Oligarchy or net neutrality. Those are the only two outcomes. Net neutrality depends on an altruistic and long-term focused government. While it has happened before (telcos went through exactly this way back in the day, resulted in common carrier), I do not believe our current government or lackluster activism are capable of making it happen again. In short; oligarchy will win.

I've been trying to think of solutions, not much so far, a few thoughts:

1. Diaspora (or similar) farms that are big enough to buy a seat at the table.
2. Oligarchs sufficiently overstep to incite popular revolution. (unlikely, they're not that stupid -- they know how bread and circuses works -- it is a cookbook to them)
3. Diaspora (or similar) running over surreptitious channels.
4. Indie mesh networks similar to ham operations.
5. Geek revolt (ie: we realize we have all the power here, decide that our paychecks are not worth the price, and shut down the oligarchs before they gain unstoppable power)

None of these seem particularly likely to succeed, to me. One thing seems obvious: The further we get down the road, the more extreme the solution will have to be. Well, make that two things: The short term gains to the oligarchs will be enormously outweighed by the friction, and hence loss, to our GDP growth rate -- punishing us all, including them, in the long run.

The fault in the Hulu Business Model

[mbone]

This has been the fault line in the Hulu business model since Day 1 - there is no way Hulu wanted to do this (block Internet users based on who they are affiliated with?), but they are a creature of their owners, who basically don't want Internet TV to succeed. It is a little surprising to see Rupert Murdoch do this so nakedly over such a comparatively trivial dispute.

If you think you are going to "Cut the Cord" with Hulu, think again.

Re:no one blames the fans?

[JackieBrown]

Dollhouse did suck. It only lasted two seasons as an apology for Firefly

Re:no one blames the fans?

[Pharmboy]

Firefly has a 9.5 rating on IMDB. Very, very few programs have ever accomplished that. As for ratings, they are also affected by time slots, moving programs around, and showing the episodes OUT OF ORDER. And yes, the media blitz that was planned for Serenity was cancelled at the last minute by the studio, so it had to sink or swim purely by word of mouth. With DVD sales, it still managed to better than break even, although not by much.

Yea, Family Guy had lousy ratings and was cancelled by Fox. Right before it set a new record for DVD purchases of a TV show. And they cancelled it yet again after that.

Re:Who are the good guys?

[hairyfeet]

Oh please, that is TOTAL bullshit! You know what happens with NO regulation? Mergers, that's what. The big ones would simply crush the little ones until you have one or two big ones crushing anyone who looks at the funny....kinda like right now! in my area there have been a couple of attempts at local ISPs since the big boys refuse to service much of the area, so what happened? The big boys let them play in the sandbox until they started to cost them customers for their shitty dialup or sub par DSL, and then they jacked the backbone charges (which they own, being big boys) until they couldn't afford to compete and told them "sue us, just try!". Hell my buddy worked at one. Their lawyer told them "You'll probably win, but it'll cost you about a million five in lawyers fees and it'll drag on for a decade or so" and needless to say they just closed up shop.

So please let that "invisible hand" crap DIAF already. We have had unprecedented DE-regulation since Reagan, and what has it got us? Clearchannel, Comcast and Cox cable, AT&T. A handful of major players OWN the entire market and can get together and screw you ANY time they feel like. Money is POWER folks, money crushes competition, money buys exclusive areas, money buys laws. All deregulation does is help those top companies concentrate that money to the detriment of us ALL.

Re:no one blames the fans?

[DavidTC]

Have you not watched Inception or Toy Story 3?