Startup Zediva Streams Movies From DVD Players To Customers, But Is It Legal?

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Zediva is attacking the movie streaming business from a slightly different angle than Netflix and all the rest. They stream DVDs — not digital copies but rather the actual DVDs from actual DVD players. Zediva buys the DVDs retail and streams them from a bank of DVD players located somewhere in Silicon Valley. Customers then rent control over these DVD players for four hours.

The company believes this 1:1 rental method circumvents regulations that currently restrict other services from streaming new releases. But others disagree. Copyright lawyer Bob Garrett was quoted by NPR in regards to the service as “cute, but illegal.” Ouch.

The lawyer explains that transmitting programming over the Internet requires a separate copyright permission. A court deemed a similar system used by a hotel as a violation of public performance right and that system only streamed content over a local network from a DVD player located in the hotel to a customer’s room.

Still, Zediva feels different and stated that they did their homework. The startup feels as if their method is no different than the brick and mortar store model. Customers are renting a DVD for a specific amount of time and since a DVD player can only stream to one customer at a time, there’s only a limited amount of rentals for a given movie. Customers might have to wait a few hours until a DVD becomes available. Their technology even allows renters full control over the DVD player and can pause, rewind and add subtitles to the movie.

Zediva might be onto something as long as Hollywood or Obama’s new IP czar doesn’t unleash the hounds. The service, which is currently in a closed beta phase, is packed full of new release movies. The Fighter, 127 Days, all the new releases are there to be streamed. That’s something Netflix can’t say as movie studios make the service wait weeks before they have access to the latest movies. Apparently even HD content is on the way as the company adds Blu-ray titles to the mix. Currently one four hour DVD rental runs $1.99 and a ten pack runs $10. No word on when the company will open registration up to the general public, though.