Industry Roundup

HP entering TV business? The line between the computer and consumer electronics industry gets blurrier by the day. During the last week of November, computer giant Hewlett-Packard announced that it would begin offering its own brand of large flat-screen TVs. Already in discussions with several Asian manufacturers, HP will deliver both LCDs and plasma display panels (PDPs) under its own name, probably by spring.

HP has approximately 150 consumer electronics products available now. The company began its push into the home entertainment arena a couple of years ago, and demonstrated its "Media Center PC" at the most recent Home Entertainment Expo. HP televisions will be multimedia capable, for use with video games and photo collections as well as computer graphics and full-motion video. With its move into flat-panels, HP will follow competitors Gateway and Dell into the convergence market. Chipmaker Motorola is also rumored to be making a similar move. Computer retail chain CompUSA recently announced that it would make space in its stores for flat-panel TVs and associated home theater gear. Almost simultaneously with the HP announcement, CompUSA also revealed that it would be acquiring The Good Guys, the San Francisco–based chain of audio/video specialty stores.

News Corp. and DirecTV: The acquisition of satellite broadcaster DirecTV by News Corporation is one step closer to reality, thanks to a November 26 approval by the US Justice Department. Officials in the antitrust division sent memos to the Federal Communications Commission (FCC), FBI, and Office of Homeland Security stating that they "have no objection to the FCC granting the relief requested in the applications" for the merger. Majority shareholders at General Motors, parent company of Hughes Electronics (owner of DirecTV), approved the sale last year when satellite service EchoStar was a suitor. That acquisition was blocked by federal regulators because it would have created a "monopoly in the sky," or a single satellite television service for all of North America. Should it win regulatory approval, News Corp.'s $6.6 billion offer would give it one-third ownership of DirecTV. A major concern among regulators is that News Corp. is foreign owned, "organized under the laws of Australia."

No ruling yet on Oscar screener ban: A federal judge in Manhattan has promised to rule on a request by independent film producers for a temporary restraining order that would require member studios of the Motion Pictures Association of America (MPAA) to issue screener copies of movies nominated for Academy Awards. On September 30, the MPAA announced that it would no longer provide free copies of the films on DVD, citing evidence that some had found their way into the hands of professional pirates. That decision was mitigated somewhat after widespread complaints; on October 23, the MPAA decided that it would permit distribution of films on VHS tape, each with a traceable code, and each sent out with the agreement that it not leave the premises of the primary borrower. The film industry organization also limited the number of recipients, specifically excluding some Academy voting members, such as actors, who might be tempted to sell their screener copies.

As a result, the MPAA was slapped with a $25 million antitrust by the NY and LA chapters of the Independent Features Project, an alliance of independent film producers. Joining the IFP were companies with feature films in production, including Robert Altman's Sandcastle 5 Productions.

US District Chief Judge Michael Mukasey criticized the IFP for waiting "more than a month" to file suit, saying such action should have happened in September. He also dismissed MPPA assertions that the organization, in the words of its lawyer Richard Cooper, "does not decide on, impose or enforce the ban." If that were the case, Mukasey stated, the MPAA should "have no objection to withdrawing this ban." Mukasey promised to rule on the case Wednesday, December 3.