A thousand copies (or so) of Revenant in VidAngel’s DVD vault.

VidAngel just went to court on Thursday to appeal the injunction against their streaming movie filtering service. VidAngel is an interesting streaming service that allows you to buy a movie and then filter the movie according to your tastes at that moment; for example, you could change your filters depending on who is watching.

Or you could, if the courts would let them perform the service. Currently there’s an injunction against them.

VidAngel is a very neat idea. Their ads are very funny. Is VidAngel as useful as their ads say? Probably. Now, most movies are not as funny or as well-directed as VidAngel’s ads. But their ads are also a little misleading. Specifically, there are three things that are clearly explained on their web site but that are implied to be otherwise in their very funny and well-made ads:

1. You can’t rent movies for $1. You aren’t renting movies at all, if they’re telling the truth: you’re buying movies for $20 and then getting $19 back. Except that if you have a widescreen television set, you probably want to buy the HD version, which also costs you $20, but you only get $18 when you sell it back. So for most people nowadays it’s going to be $2 per movie.
2. You can’t wait any longer than RedBox to return the movie. Just like RedBox, you get charged what is basically a late fee for every day you don’t sell it back. The movie costs you $20; you buy it and you own it. You can (and probably will) sell it back to VidAngel to get some of your money back. If you sell it back within 24 hours, they’ll give you $18 or $19 for it. For every 24 hours after that, they’ll pay you less.
3. Most importantly, you can’t actually watch it how you want to watch it, unless you always want to watch it filtered.

Now, all of these are clearly explained on the web site. I went in expecting to try out a movie-watching site where I could watch filtered or unfiltered for a buck as I wished, but by the time I got to the actual “give them money” step, I knew that wasn’t the case.

Two of these requirements are, however, weird.¹ The sell-back’s daily depreciation is weird from a legal standpoint. While depreciation certainly exists with DVDs, and so there should be some form of depreciation (and perhaps missed-opportunity storage fees) reflected in their buyback price, it seems like they’re asking for trouble by creating a depreciation scheme that exactly mirrors late fees.²

The requirement that you, as the owner, must watch the movie filtered is weird from a customer standpoint. If you own the video it would seem that you should be able to watch it unfiltered. And from the legal standpoint, if the customer can’t watch it unfiltered do they really own the movie? The likely reason for this is that VidAngel is relying on an exemption from the Family Movie Act of 2005, and that exemption applies specifically to filtering services.

VidAngel’s basic idea is fairly simple, and probably legal if done right. The chances of it being done right are pretty slim. Here are where the problems are likely to occur:

1. Their pricing scheme is close enough to rental that many customers see it as rental rather than ownership. It’s confusing enough that even VidAngel doesn’t always get it right on their own blog.

   Sell back the movie within 24 hours it’s $2, up to 48 hours is $4 up to 72 hours is $6, etc Until you reach the purchase price. At which point you own the movie. Once you own it, it will always be in your VidAngel vault to enjoy whenever you would like.

   Technically, the customer owns it immediately. All that happens after ten days is that they can no longer sell it back. That very page gets it right in several preceding paragraphs.

2. In order to let someone use their own media over the Internet, you have to let them literally watch their own media. This has been the bane for services like this since I owned my first personal computer in the eighties.

Back when computer programs came in magazines and you typed them in, some entrepreneurs got the great idea that they could make money by typing the programs in for you. So they’d type the programs once, you would send some part of your cover that proved you had a copy of the magazine, and they would send you back the copy that they had typed in. This was illegal, however, because they were not sending back a copy typed in from your magazine. They were making one copy and then distributing that copy, and that combination is a copyright violation.

MP3.com had the same problem: they made you prove that you owned a copy of the CD, and then they put the same copy into your locker that everyone else who owned the CD got. You weren’t getting a copy of your CD, you were getting a copy that MP3.com had made once, and then were distributing.

Now, at the time of MP3.com, making a copy of every user’s CD for that user’s locker would have required so much storage space that MP3.com wouldn’t have been able to do it. Nowadays that might not be the case. It’s possible that with the right disk-level compression scheme, VidAngel could in fact hold a different copy of each DVD per customer, especially since they’re buying those copies back.

The problem is that they are not making this clear. They appeared to argue both cases in the appeal: that they have a one-to-one relationship between customer and copy; but also that they stream from a master copy. These are not the same thing, and it is critical to their argument which one they mean. I don’t see how the latter can’t be illegal, barring some other exemption. It would be no different than each customer owning their own copy of a CD, but MP3.com streaming from a single master.

Depending on DMCA exemptions, the former, streaming each customer their own copy, might be legal.

VidAngel streams content from the DVD to each purchaser while applying the filters chosen by that customer.

Like their court testimony, that’s a bit ambiguous.

Whichever version they mean does mean that if VidAngel sells their last copy of a DVD, they can’t sell any more until they go out and buy more copies to sell. I haven’t heard of that happening, but they do claim that they can run out of stock on movies:

Now, the piracy accusers say we don’t pay Hollywood enough. But remember, we pay them just like Redbox, by buying discs. And just like Redbox, we have to buy a lot or we go out of stock. In fact, we spend about 1/3 of our revenue on discs. So if we’re pirates, then we’re terrible pirates. Just not as terrible as Pirates 2 through 4.

Note that the filtering itself is specifically not illegal. That’s from the Family Movie Act, which was passed in 2005. The question, if VidAngel is in fact not keeping a separate copy per disk, is whether or not the Family Movie Act also removes that requirement. It sounds like it could be read that way, both since the point of the legislation is providing filtered movies, and since the law specifically forbids them from sending a fixed copy of the altered version to the viewer.

There’s another question, though, and that is, is VidAngel useful? My experience is, yes. I’m not really their market: I can’t think of anything they let me filter that I would want to filter out of a movie.³ Remember, you can only watch movies filtered. If you don’t want to filter anything, VidAngel is specifically not for you.

But I wanted to try the service out anyway, so I have watched a few movies on it. While some of them, such as Frequency, are nice family movies, some of them have a lot of filtering available. Yes, Deadpool, I’m talking about you. As a non-filterer, it’s harder to watch a movie like Frequency than a movie like Deadpool. While you have to filter something, you can choose what you filter. Deadpool has a whole bunch of choices, some of which I don’t care about, such as bad language in subtitles. Frequency, on the other hand, does not have a whole lot that needs filtering. And, not being a series of in-jokes, what it does have is still relatively important to the story.⁴

What I can say is that the video quality is excellent. The movie choices, while smaller than something like Netflix, are also excellent. It has many movies I want to watch that Netflix doesn’t have at the time I’m writing this: Frequency, for example, Ted, and Hot Tub Time Machine. Among movies I haven’t yet watched, The Maltese Falcon. One of those I suspect will have more filtering available than the other.

The filtering is as unobtrusive as it can be. As a non-filterer, I tried to find something that only happens one or two times in the movie; a couple of times I didn’t even notice where it had happened. Other times there’s just a slight pause in the audio.

If there are movies you’d like to watch with your family that you aren’t because of objectionable content, VidAngel seems to be an amazing streaming service.

Assuming they win their appeal in the short term, and their court case in the long term.