It was a brilliant $100m bet that backfired for no good reason.

No good reason? They tried to exploit a technical loophole that was clearly against the spirit of the contracts and law.

But there's no good reason that it's legal to buy a server and stick an antenna on it, but it's not legal to rent a preconfigured server that has an antenna on it.

There wouldn't be loopholes if the law was consistent, and I would argue there is no 'spirit' in such a confusing set of rules.

always wondered if netflix couldn't have had warehouses full of dvd drives to avoid licensing fees. wouldn't work for new releases with a lot of peak demand but maybe it would be more feasible for the back catalog of older titles.

Zediva did this for a while before they were shutdown. I guess this is a lesson on the risks of disrupting an industry through a loophole that can be shutdown by a single ruling.

When you buy a consumer DVD, that DVD only has a license for home viewing. Video stores require a special license to rent out videos. So, I assume netflix would have to pay that fee at least (which they probably already had for their mail order DVDs).

> Video stores require a special license to rent out videos.

First sale doctrine covers rentals, but having good relations with studios to get supply of new releases often influences rental establishments to avoid buying discs at retail to rent out. (But, RedBox will sometimes do it)

They agreed to stop a few years ago. Redbox used to break the "buy only" window of DVD releases. Meaning you could rent a movie from Redbox before it was available to rent on any streaming service.

They buckled from pressure from studios and agreed to stop for the reason you gave.

It kind of seemed at the time that they used their right to do this as a negotiating tactic in getting better prices from distributors.

They wouldn't rent the DVD to you. They'd sell it to you, with an agreement to buy it back later on. First-sale doctrine, baby!

They might also need to sell you a short-term lease on that particular drive bay, so that you are playing the DVD in your own home too.

Would they be able to achieve that without using libdvdcss which could cause legal problems? Also, I think most people want HD or 4k these days

A "matrix" for DVDs, safely ensconced in their little pods until their master grows weary and evicts them to the discount bins.

Wouldn't want to be in charge of maintaining the system that has to handle the DVD and DVD drive farm.

Wow, what did that look like?

Wow, that's pretty much exactly the kind of introspective I guess I was looking for. Thanks.

Kind of sad it got killed off :(