New technology can be tricky because it has the ability to complicate legislative and contractual matters. The internet has shown this to be true in a number of ways over the past decade, from censorship issues to copyright concerns. Now with the growing industry of movie downloads and other forms of distribution on the web, some old deals are being interpreted in new ways. Starz Entertainment, which has been paying for exclusive rights to Disney films since 1993, is now suing the studio because of one such interpretation. The 14-year-old contract was renewed as early as 2005 and primarily relates to cable television rights, but Starz is claiming its deal extends to internet distribution too. Since Disney is selling titles via services like iTunes and Walmart.com, it is violating this agreement.
But you are probably wondering how television licensing and web licensing can be viewed as similar, especially in a deal made long before downloads and streaming video existed. Obviously Starz is just angry that its own download service, Vongo, isn't as lucrative as iTunes, right? Well, the company has already been through a similar battle with Disney, having sued the studio a few years ago over MovieBeam, a video-on-demand service that Disney itself set up. Starz won that lawsuit despite the fact that the service wasn't through any cable provider (MovieBeam was forced to split from Disney a year ago, though it has just been purchased by Movie Gallery) -- although it is more similar to cable than internet because it was for play on your television. Starz is now concerned particularly with Disney's deal with iTunes because of the new Apple box, which allows iTunes downloads also to be played on a TV set.
Of course, DVDs and other home videos are also playable through the television, so there needs to be a distinction made somewhere. I have a feeling that the courts will make a new distinction regarding internet product and this time around Starz will not be the victor.