Web VCR Replays Power Struggle

Undaunted by the legal backlash against a Web site that wanted to carry live television, another site has created an online VCR.

RecordTV.com, based in Los Angeles, is offering Web surfers the ability to record TV shows and play them back online. Already, 50,000 people use the service, and snowballing interest is overwhelming the small site’s systems.

Rewind a few months, and the story looks similar to the efforts of Canadian start-up ICraveTV, which hoped to put live broadcast television on the Web late last year. That effort collapsed after U.S. and Canadian broadcasters filed lawsuits in February.

RecordTV founder David Simon said the company is simply replicating a VCR online and hopes to avoid the legal troubles that undermined ICraveTV.

“We act like a VCR, we work like a VCR, and we should fall under the same [legal] exemptions as a regular VCR,” Simon said.

Already the same industry giants that sank ICraveTV are taking a hard look at Simon’s service. And Simon said he’s looking for funding to support future legal bills.

The small site’s business plan underscores an unresolved issue: Who will control popular TV content as more consumers go online to be entertained?

The TV broadcasters want this power because they’re producing the content. But Net companies, impatient with TV companies’ cautious progress online, are chafing to bring the broadcasters’ content online themselves.

In the United States, companies that want to use broadcast TV feeds are required to get a license from broadcasters. Late last year, the TV industry went to Congress in an attempt to block Net companies from being able to get those permits. That effort was derailed at the last minute, but the issue remains unresolved.

ICraveTV initially thought it was shielded from copyright questions by Canadian law as long as it agreed to pay the broadcasters royalties. But movie studios, sports leagues and TV stations on both sides of the border disagreed. They filed lawsuits worth billions of dollars.

ICraveTV pulled its own plug and sought a new business model.

As Simon looks for investors and major advertisers to support his site, the same forces that shut down ICraveTV are circling.

“We are looking at it,” said a spokeswoman for the Motion Picture Assn. of America.

Simon said he started the service late last year as an experiment for his children. They had computers and Net connections in their rooms but no television, and they still wanted to watch their favorite cartoons, he said.

He quietly made the service public early this year, and word started leaking out in March. Now he gets about 200,000 hits a day, with more than 50,000 users, he said.