Lawrence J. Blanford, the President and CEO of Philips Consumer Electronics North America, warned Congress today that if certain Hollywood studios get their way, millions of consumers will have to replace their DVD players to watch digital TV programs that they have recorded.
Testifying before the House Energy and Commerce Subcommittee on Telecommunications and the Internet, Blanford said that certain studios, working with a small group of hardware companies known as 5C, are devising a plan for controlling the content of digital broadcast TV that raises serious issues of cost, complexity, reliability and confusion for consumers. "This proposal," he said, "threatens the fair use rights of the consumer and introduces unnecessary levels of complexity and costs in consumer devices."
Blanford also expressed concern that consumers may have less control over what they see and record. The technology that supports the emerging plan is inherently powerful; it has the potential to remotely disable a device that is recording a movie or other program in a consumer's home.
In essence, through their private contractual relationships, this small group of studios and companies would control digital TV technology and how people use their TVs, DVDs, and other devices in the privacy of their homes.
"The current direction," Blanford said, "is not in the interest of sound public policy, is not in the interest of the affected industries and is certainly not in the interest of the consumer."
Blanford warned that Philips, which has been participating in the industry working group -- the Broadcast Protection Discussion Group (BPDG) -- that is pressing this plan, has "lost all confidence" that the group will achieve consensus, "or that it will allow for serious consideration or adoption of technology solutions of equal merit presented by other interested parties."
"Private industry should be given a chance to reach a consensus," he added, "but the process should be cleansed by the sunlight of government. Further discussion should be held in an open forum, with the involvement of those who are entrusted with the development of public policy."
As a result, Blanford called on Congress "to reassert its role in this critical public-private partnership by providing an appropriate, public forum to continue these industry discussions and to foster workable solutions on a timely basis." He said that Philips would offer "complete support to such an effort, including offering related Philips technologies to all comers, under open, fair and easily available terms." He also called on other companies to join this discussion to assure that "we get this right."
The issue at hand is how to develop a technology to protect the content of digital TV against unauthorized retransmissions over the Internet. Philips wholeheartedly supports the goal but believes that it must be achieved in a way that protects the "fair use" rights of consumers to the content that they enjoy through their TVs, DVDs, and other recording devices.
"This issue will affect consumers, studios, consumer electronics, and information technology companies for years to come," Blanford said. "We need an approach that will be fair to everyone."
The problems, he explained, arise from a faulty process. The BPDG was created to discuss approaches to address the challenge of preventing digital TV broadcasts from being re-transmitted over the Internet, and to do so in a way that allows technology to thrive and the consumer to be protected.
A group of companies within the BPDG, however, is pressing an approach through which all manufacturers of TVs, DVDs, and other devices will have to sign up for an overly broad, burdensome and private license, which will govern the encryption technologies that must be in these devices and the process to enforce copyright protection. This small group of companies will mandate the technologies, control the rules that govern the technologies, and change those rules whenever they desire.
Most alarming, the public, consumers, licensees, and public officials have not been part of the process that developed the 5C approach, and they would be shut out of its implementation.
"In short, private interests are taking control of the balance among consumer rights and commercial interests and, as a result, establishing public policy," Blanford said.
"Philips cannot, and will not, accept that. We believe other companies will not accept that. Congress should not accept it either."
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