I've spent the past year, off-and-on, working on a free software PVR. The initial results using MythTV were unimpressive -- picture quality was terrible, playback was jerky, and it left me seriously considering the purchase of a Tivo.
Fast forward to the middle of February, 2004. Comcast has decided to start turning on the previously dormant IEEE1394 ports on their Motorola DCT6200 and DCT6208 set top boxes. The New England market received a 1394-enabling version 7.07 firmware a little more than a week ago. The original, pure, unencrypted MPEG2 transport stream (MPEG2ts) is now being broadcast over the 1394 ports. This new functionality enables perfect digital recordings of programs -- including High Definition ones. The intended purpose of such ports is to enable digital recordings by DVHS recorders (digital VCRs capable of recording high definition (and standard definition) content over a 1394 port).
I recently spent $9 on a IEEE1394a card and $20 on a 14ft IEE1394a cable. For $29, and a GNU/Linux box, I can now make perfect recordings -- entirely with free software. That's not a bad deal. At some point in time, Comcast will most likely turn on encryption (DTCP aka 1394/5C) on the IEEE1394 ports, and while DVHS recorders will continue to work, PCs will no longer be able to record the MPEG2ts.
Since it's likely that Comcast will eventually turn on 5C encryption, it would be nice if there would still be some content out there that can be digitally recorded with free software. I started doing some research into newer HDTV over-the-air set top boxes, which now contain IEEE1394 ports. These boxes take an over-the-air ATSC signal and decode it into a MPEG2ts and send that data over the 1394 port. The only catch is that all ATSC decoders sold after July 1, 2005 will have to recognize the BPDG flag, and if that flag is set, those "new and improved" decoders will no longer talk to unencrypted 1394 devices (ie. your PC). So while the ATSC radio signals being broadcast to your home are unencrypted, if the BPDG flag is set, the FCC has mandated that it will not be legal for hardware sold in the US to send that unencrypted data to other devices that can be easily used to exercise your fair use rights of those copyrighted works.
In the end, it's a pretty good bet that with cable and over-the-air digital ATSC broadcasts (with the BPDG flag set), you will not be able to make digital recordings using free software, or even with proprietary software on a PC. The Entertainment Industry and FCC are happy to restrict your fair use if a PC is involved, as long as illegal sharing of the Entertainment Industry's content on the Internet is made difficult.
The Entertainment Industry is also worried about the "analog hole". It's not just enough to prevent fair use copying of digital content, but they also want to prevent copying of high definition (anything above 640x480) analog content. The technology used to "prevent" and track analog copying -- watermarking -- could also be used to prevent illegal redistribution of digital content. Digimarc, Macrovision, and Philips are all in favor of using watermarks on digital content.
If the Entertainment Industry's real goal is to not restrict fair use of their copyrighted works, but instead to restrict illegal sharing on the Internet, then why not use watermarking technologies?
Each digital cable box is already individually addressable -- this is how the cable company is able to bill subscribers for Pay Per View movies and determine what channels you are authorized to watch. Since they know who you are, the cable box could simply modify the MPEGts to include a watermark specific to each cable box. If a movie or TV show is illegally shared over the Internet, the Entertainment Industry could check the watermark, and trace back the path of infringement. They could then file lawsuits against parties that have infringed their copyrights.
It's my hope that fair use rights will be preserved as we move toward entirely digitally-connected entertainment systems, but somehow I doubt that's how things will turn out. Fair use will simply be collateral damage in the war to keep digital content off the peer to peer networks.
Oh, and if you want to buy a HDTV over-the-air tuner that will permit you to exercise your fair use rights, do that before July 1, 2005. The MIT MDR-200 for $399 is a highly recommended one. Support the EFF in their cause if you think the BPDG flag is a bad idea. There's still a small amount of hope that the war has not been lost.