Real's Glaser: Some studio chiefs 'scared' of tech

SAN FRANCISCO--Hollywood is missing out on a marvelous opportunity, says RealNetworks' CEO Rob Glaser.

Real has presented the film industry with a means to inject renewed interest in DVDs, which is waning, Glaser said minutes after testifying at a hearing in federal court on Wednesday. Real has developed two different kinds of software, RealDVD and Facet, that it says streamlines the movie-viewing experience by enabling owners to duplicate DVDs and store the copies on hard drives.

But the studios, much like they've done since the Sony Betamax case, are resisting technological advancement and have rejected the opportunity Real offers, Glaser said. He thinks he knows why.

"Some of the studios are very progressive," said Glaser, who founded the public company in 1994. "Some of them are scared. It's been my experience that often the scared voices overwhelm the progressive voices."

Glaser's assessment of film industry CEOs couldn't be further from the truth, said Elizabeth Kaltman, a spokeswoman from the Motion Picture Association of America, the lobbying group of the six largest movie studios.

"These (film) companies have embraced innovation and collaborate with the technology community to deliver content in a myriad of ways," Kaltman said. "The studios are working daily to license movies and TV shows for online distribution to give consumers the flexibility they desire."

Fear of technology is only one of the reasons that Real says it has come under fire from the MPAA. The film industry filed a lawsuit last September that accused Real of violating copyright and breach of contract. The studios claim that RealDVD violates the Digital Millennium Copyright Act by circumventing the copy protections on DVDs. Real's software also doesn't comply with the license granted by the DVD Copy Control Association, the group formed to protect DVDs, according to lawyers representing the studios.

In an interview with CNET, Glaser denied the charges.

At Glaser's side, Bill Way, RealNetworks' deputy general counsel, called the allegations that Real breached its contract flat wrong.

"The notion that we are guilty of circumvention when we have a license is crazy," Way said. "There is no cases that show that if you have a license you can be found guilty of circumventing encryption."

On Tuesday, Glaser demonstrated for the court a prototype of Real's new DVD player called Facet. The software within not only copies and stores DVDs but allows users to hop around instantly between movies or TV episodes. The device has been called a Tivo for DVDs. Glaser said the machine offers the kind of convenience that consumers demand but Hollywood refuses to listen.

"They should be embracing us," Glaser said. "If all you do is fight your customer, you drive the mainstream market underground. This is a huge strategy mistake...The big picture view is that they can make a lot more money with us than fighting against us."