One of the two cases against satellite TV company DISH Network settled last week, with Disney ending its quest to have DISH's automatic commercial-skipping feature, AutoHop, made illegal. In addition to calling off its lawyers, Disney agreed to stream some shows from its popular networks like ABC, Disney Channel, and ESPN over the Internet to DISH subscribers. In exchange, DISH agreed to disable the commercial-skipping functionality for three days after a show is aired - corresponding to the period that the Neilsen Company includes in its audience measurements.

We're pleased that Disney dropped its silly legal challenge against DISH's digital video recorder. Although Disney had put together a convoluted legal argument against DISH, at the end of the day Disney could only succeed if it could convince the a federal court that TV-watchers are breaking the law when they skip commercials. As EFF argued in our amicus brief along with Public Knowledge and the Organization for Transformative Works, commercial-skipping is legal no matter how convenient DISH might make it. Disney's effort seemed especially futile after another appeals court rejected a similar case brought by Fox last year.

Still, DISH's agreement to lock out the ad-skipping feature until three days have elapsed from the original broadcast is disappointing, given that the law has nothing to say about commercial-skipping. Aside from dropping a lawsuit that Disney was likely to lose anyway, the quid pro quo for crippling the Ad Hopper seems to be making some programming available to DISH subscribers online. Walling up online video content and making it available only to cable or satellite subscribers - known as the 'TV Everywhere' strategy - seems destined to keep Internet video an add-on to expensive pay-TV packages instead of a low-cost competitor in its own right. If this settlement is just another step down that road, plus a less useful DVR than the one DISH released two years ago, it’s not much cause for celebration.