Internet TV Startup Launches Pre-Emptive Lawsuit Against Networks

Barely a week after launch, a Seattle-based streaming TV startup filed suit against major broadcast networks, hoping that a court will approve of it’s attempt to retransmit live television broadcasts over the Web.

Unlike streaming video-on-demand services like Hulu and Netflix, the plucky ivi, Inc. says it will give viewers access to more than 20 live TV streams from networks such as ABC, NBC, CBS, Fox for the low price of $4.99 a month. Only one problem: Nobody ever told the networks.

Because it’s “retransmitting” TV streams online, ivi claims that it does not have to pay the pesky FCC mandated retransmission fees like a cable company would, but it does pay content royalties to broadcasters through the copyright office, and releases viewership data to Nielsen so networks can factor it into their advertising calculations. According to ivi, it’s actually doing broadcasters a service by distributing existing broadcast feeds to a larger audience. However that hasn’t kept most of the major broadcasters from sending cease and desist letters to the company.

Rather than wait to get sued, ivi filed a suit of its own against broadcasters including NBC, CBS, ABC, Fox, and Major League Baseball, seeking a declaratory judgment from the state of Washington’s legal system.

The 18-person ivi says it has gone to great lengths to prevent content piracy by encrypting its feeds, and founder Todd Weaver scoffed at a comparison between ivi and online piracy. “We’re conforming to us copyright law exactly to the letter and paying the original broadcaster. We’re more comparable to the early cable companies. It has nothing to do with piracy whatsoever, and we frown upon piracy,” he said in a statement.

For the legally-minded, a ful .pdf of ivi’s complaint can be found here.