Loophole allows movie streamer to stick two fingers up at Hollywood

A legal loophole has enabled a small streaming movie service to stick it to the movie studios.

According to Wired, Zediva is offering new release movies that you can’t get on Amazon, Netflix or iTunes that cost $2 for a digital rental that lasts for two full weeks.

You might think that getting approval for that business plan would not fly past the studios and you would be right. But Zediva did not have to ask them.

The outfit gets around the law by renting you a DVD  but using your computer, tablet or Google TV as the remote control. Zediva’s servers have DVD drives and actual DVDs. So when you rent a movie, that disk goes out of circulation until you release it back to the company. It is a bit like the video stores.

They dont have to ask about it because they have bought the DVD and are free to rent it out or re-sell it, thanks to the first-sale doctrine in U.S. copyright law.

You have two weeks to watch movie and it runs exactly like a DVD in your machine. One thing they have found is that people will watch a flick in five sittings rather than sit and watch the whole thing from start to finish.

The outfit is still in the beta stage and wants to launch with 100 titles, mostly Hollywood films, and is offering two free streaming movies to any user who signs up before March 31. For those who like the service, you can pre-pay $10 for 10 rentals.