Friday, 26 August 2011

Rocky start for Shaw’s movie streaming service

Rocky start for Shaw’s movie streaming service
Todd Korol/Reuter  Jamie Sturgeon Aug 25, 2011 – 6:34 PM ET

TORONTO — Shaw Communications Inc.’s foray into online movie and television streaming is off to a rocky start.
The Western Canadian cable and Internet giant has been hit with legal complaints from major motion picture studios to either pay up or remove titles from its new Movie Club online service, sources say.

Launched last month to capitalize on shifting viewer trends among Shaw customers, the subscription-based service showcases hit Hollywood productions pulled in primarily from Movie Central, a premium pay-television channel owned by Corus Entertainment Inc. that Shaw carries on cable.
Shaw, however, does not have permission from the studios that own the rights to those pictures to carry them on Movie Club, triggering a wave of cease and desist orders.
“It is them packaging content into a whole new service without speaking to the rights holders,” said a person close to the matter at one of the effected studios.
“If they want to have a continued service they are going to have to properly ensure they have the right to make those titles available [by] directly acquiring them from their owners,” the person said.
The legal mishap underscores the challenges TV and broadband distributors such as Shaw, Rogers Communications Inc. and Bell Canada Inc. are facing as they attempt to secure content for emerging Internet and wireless products that consumers have begun seeking from their provider.
Calgary-based Shaw launched Movie Club in mid-July exclusively to subscribers. A $12 monthly fee gives users access to more than 175 motion picture titles from Warner Bros., Universal Pictures and other major film producers.
At the time, president Peter Bissonnette suggested the company’s contractual agreements over the use of Movie Central programming were sound. Indeed, Corus does have limited digital streaming rights for the pay-TV channel’s content.“We bought the rights to these movies through our relationships with movie services, the pay-television movie services,” Mr. Bissonnette said in an interview last month.
Jay Mehr, a senior vice-president, said in an emailed statement Thursday the Corus channel “has the rights to provide this offering” to Shaw’s Movie Club “under the terms of its studio deals.”
Still, Shaw has taken down some titles as a result of the complaints, people familiar with the matter said, while discussions are being initiated.
Brian Gray, a copyright lawyer at Norton Rose in Toronto who has previously represented some studios interests, said disagreements over distribution rights usually get resolved. “If it something that consumers want then presumably the parties who are providing the content and the parties who are providing the distribution will get together to deliver that,” he said.
“We of course see commonly with all of these issues … shall I say, a discussion, about how they divide up the pie.”
Shaw Communications Inc.
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