Survey: Dealers React to DVD CCA vs. Kaleidescape

CE Pro survey indicates 57% of integrators are “not really” concerned about their own legal liability and 42% say they’ll continue to sell Kaleidescape movie servers while injunction is appealed.

By Julie Jacobson
March 20, 2012
Bloggers, pundits, digital rights fanatics and enthusiasts have all chimed in on the recent injunction order against Kaleidescape in its seven-year legal battle with the DVD CCA (Copy Control Association).

A Santa Clara, Calif., judge issued the injunction against Kaleidescape’s DVD movie servers, but Kaleidescape has appealed the decision and believes the injunction will be stayed pending the outcome of that appeal.

So what about the people with the most skin in the game: Kaleidescape dealers and the larger community of custom electronics integrators?

In a flash survey of dealers via Linkedin, 158 CE pros responded to questions about Kaleidescape and the future of movie servers.

Not surprisingly, the survey is heavily skewed towards Kaleidescape dealers. Exactly half of the respondents say they sell Kaleidescape products.

Most dealers (86%) are only “mildly” or “not really” concerned about their potential legal liability in selling movie servers – Kaleidescape’s or otherwise.

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In our quick research, only 5% of respondents say they will stop selling Kaleidescape as a result of the injunction. Last week, Kaleidescape CEO Michael Malcolm issued a notice to dealers that the injunction “may never go into effect,” and even if it does go into effect, “we believe our dealers will not be subject to the injunction because they act independently and outside of Kaleidescape's control.”

Lawsuit 'Clearly Ridiculous'


Regardless of how they will respond to the ongoing legal battle, dealers overwhelmingly agree with Mark Nettleson of Recluse AV in Melbourne, Australia, who calls the latest ruling "clearly ridiculous."

He comments, "Kaleidescape are being punished when they have done so much work to legitimise movie servers. Do the DVD CCA not realise that they are going to do more damage than good if they take down Kaleidescape?"

Another dealer wonders, "Is DVD such a hot category that it needs protection like this?" He [we assume it's a "he"] suggests, "This is a power move by manufacturers of DVD products to "stay relevant" which they are going to ultimately lose anyway."

EJ Fuelner, managing director of HiFi House, Broomall, Penn., writes:

This is a travesty for our industry and for small, innovative companies across all industries.

To think that a 'sanctioning body' can stifle innovation of a product and product category by shutting down a company that is fully compliant and legal to the letter of the law is an embarrassment to both our industry and the greedy Hollywood establishment fat-cats pushing this anti-competitive agenda.

The facts are that Kaleidescape probably did more to promote DVD sales than any of their myriad money-grubbing schemes ever could. And it does so with absolutely NO risk of copying, stealing, or infringing on any Hollywood content or rights.

Hollywood, MPAA and DVD CCA need to wake up. Aren't their bigger fish to fry causing more harm than Kaleidescape could in a million years?

More dealer comments can be found in the survey slideshow.



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