Media giants combine to tackle Kodi nemesis, Disney drops the ball

Eight of the video industry’s most powerful and influential companies have put rivalries aside in the name of bringing down content pirates. The emergence of another combined, industry-wide effort is positive news in the battle against piracy, yet the OTT ecosystem is still crying out for an effort to promote a cross-industry collaboration – one extra step that could make all the difference.

Amazon, Netflix, Disney, 20th Century Fox, Universal Studios, Columbia Pictures, Paramount and Warner Brothers have filed a joint complaint against Dragon Media, a supplier of set tops installed with the infamous Kodi software. The Dragon Box set top uses software to link users to infringing content on the internet, including movies, TV shows and live sports, at no extra cost.

Kodi, the third-party open source media player, is the primary source of accessing illicit content on the Dragon Box, earning itself the reputation as the streaming world’s bad boy, following multiple court cases against Kodi set top suppliers in recent years. However, Kodi software receives additional support from its lesser known cousins called addons. An addon is a software program that runs in conjunction with an underlying software program like Kodi, to provide functionality over and above that which the underlying software provides – scouring the web for illegal content and sourcing back links for end users.

The court filing notes that Dragon Media provides over 80 addons, citing one called Covenant as a particularly popular addon for accessing infringing content.

With advertisements such as “Get rid of your premium channels” and “Stop paying for Netflix and Hulu”, there is little defense for Dragon Media’s behavior in court and it is expected to be a white wash for the eight companies pursuing the case. Defendants are claiming they are entitled to damages of $150,000 per work infringed, which could end up totaling tens of millions of dollars.

Dragon Media has 250,000 customers in 50 states and 4 countries, with 374 sellers globally, according to the filing, representing a quick rise to popularity, but just a drop in the rising ocean of content piracy.

Meanwhile, Disney is pursuing a separate case against US media retailer Redbox for selling movie codes, claiming a breach of contract by Redbox in its combo packs, which combine a DVD, a Blu-ray disc and a code for viewing a title online via legitimate streaming services. Disney has simply submitted the lawsuit because these online services are viewed as rival OTT offerings – going against the collaborative industry effort we have highlighted as pivotal to defeating content pirates.

Redbox has this week defended the injunction against its combo packs by saying, “Disney seeks to stifle competition to more smoothly launch its own digital content streaming service, maximize the price other services like iTunes and Amazon pay for Disney movies, and secure a greater market share for Hulu – the viewing service Disney will control as part of its $52 billion acquisition of 21st Century Fox.”

Redbox has struggled to adapt to the transition of content online, failing to challenge Netflix with its SVoD service Redbox Instant which was shuttered a few years ago, but was reborn just last month as Redbox On Demand, choosing not to take the subscription route to market this time around, instead offering movies and TV series for rent, at around $4 a title for 48 hours, or $10 a pop to purchase.

Disney’s action against Redbox therefore comes at an inconvenient time as the company attempts to rise from the ashes, having already accumulated a legal bill of $700,000 at this early stage – a clear attempt by Disney to do nothing more than sweep viable competition aside in pursuit of OTT video greatness.