News written by Rich Fiscus (October, 2008)

Despite the spectre of a recession looming over the US economy, Netflix Founder, Chairman, and CEO Reed Hastings is confident about his company's position for the remainder of the year. Although he sees slower growth than last year he predicts that recent and future developments will continue to fuel profitability.

One of things Hastings spoke proudly about in a presentation that was part of the company's third quarter earnings conference call today was the deal struck recently with the Starz premium cable network. Starz opted to close their Vongo service, choosing instead to let Netflix provide internet delivery for them.

He pointed out that one of the biggest stumbling blocks for providing such services is the contracts the big networks have that tie up major studio content, adding "With this new model we think we can generate increased profit for Starz, increased profits for Netflix, and over time for the studios."

He also spoke extensively about innovations that are around the corner for the Netflix streaming service. The previous quarter saw the introduction of the first Blu-ray player that can be used to stream movies from Netflix, LG's BD 300. He also hinted at additional players with Netflix support coming in the future, saying "we'll announce more Blu-ray partnerships as they're ready for consumers."

While speaking in Des Moines, IA on Monday, Pandora internet radio founder Tim Westergren indicated that he believes webcasters and record label representatives are close to a deal on royalties for internet radio. The comments came at a gathering of Pandora listeners, which you can read more about in a new article here at Afterdawn.

Mr. Westergren took a few minutes to sit down with me and discuss the current state of Pandora and even speculate a little about the future. We also talked about devices that make it possible to listen to Pandora when you're not sitting in front of the computer, including mobile phones and appliances that connect to both your home network and home stereo.

For more details about our conversation you can read the entire article on our Guides and Articles page.

Yesterday we told you about a letter from the US Chamber of Commerce to President Bush in an effort to convince him to sign the annual attempt at draconian intellectual property enforcement legislation. The centerpiece of their argument to the President is a pair of oft-cited statistics claiming piracy has cost the US 750,000 jobs, as well as annual financial losses of $250 billion.

Now Ars Technica has published an interesting article that sheds a significant amount of light on the actual source of those figures and the closer you look, the less credible they look. That's not surprising considering $250 billion is more than the combined US revenue of the music, movie, and software industries. It's more than a little difficult to believe they're losing more than they're making.

A look at the sordid history of these numbers reveals just how useless they really are. To begin with they appear to have been extrapolated from the results of a survey compiled in the 1980s. The survey was conducted on a small sample of US businesses, with the resulting numbers then multiplied into an estimate of worldwide losses not from piracy, but from the IP laws in many countries, which are far less restrictive than in the US.

Several times a year we see lobbyists and legislators in Washington trying to sell the Department of Justice on the idea of a so-called Copyright Czar. Such a position would essentially create a staff of pro bono lawyers to litigate what are currently civil cases for copyright holders (ie the music, movie, and software industries). Now they're getting heat from the U.S. Chamber of Commerce, which sent a letter to President Bush claiming IP infringement "has already caused the loss of an estimated 750,000 American jobs."

That's right. Of the 9.5 million Americans who are unemployed, nearly 8% have apparently been put out of work by pirates. At least if you believe the Chamber of Commerce figures.

Of course you'd be hard pressed to confirm that since the letter doesn't bother to list any sources for that figure. Nor does it explain exactly how it "poses a severe health and safety risk to consumers."

The letter was sent in support of a bill known as PRO-IP, or the "Prioritizing Resources and Organization for Intellectual Property Act,” which is just the latest version of legislation that gets proposed annually and shot down just as routinely in one or both houses of Congress.