Omniverse One World Television is halting the marketing of live OTT-TV services to "single dwelling residential customers" and instead focusing on the multi-dwelling unit market, following a recent review of the content licensing rights held by its partner Hovsat, a New Jersey-based private cable that purportedly has a long-term deal with DirecTV.

That decision will take effect today at midnight ET, the company said. Omniverse added it will make "every effort" to ensure that rights owners and subscribers are compensated and any refunds due are promptly paid. Omniverse did not say how many OTT-TV customers it currently has via its own service, OmniGo, or has signed up through its various reseller partners.

Omniverse's pivot comes as the company and its CEO, Jason DeMeo, continue to face a copyright lawsuit in a California district court led by the Alliance for Creativity and Entertainment (ACE), a legal consortium made up of major programmers and studios. While ACE holds that Omniverse is distributing TV programming without authorization, Omniverse has argued that it is on the level, pointing to a Hovsat long-term contract with DirecTV affixed with "no limitations" with respect to US distribution and delivery method.

Hovsat Inc. has connections to Hovnanian Enterprises, a Matawan, NJ-based home builder and residential community developer with operations in multiple US states.

ACE has sought access to the Hovsat-DirecTV contract to no avail, according to documents it filed with the court. It's believed that the contract in question involves wholesale/bulk rates for TV programming for MDUs that are typically 40% to 60% less expensive than single-family retail rates. MDU pricing is usually based on 100% occupancy and, therefore, carries a smaller license fee.

Today, Omniverse said it is making changes "in light of recently received archives of records pertaining to the licensing rights of its partner Hovsat Inc.," but did not elaborate on what those archives revealed.

Omniverse said it will cease delivering live TV signals to single-unit residential customers until the company "can obtain greater clarity on the issue."

With that decision, Omniverse said it has communicated to its distribution and content partners, which includes TikiLIVE, that it will cease delivering live television content to single-dwelling residential customers under the terms of its marketing agreement with Hovsat.

In the meantime, expect Omniverse to explore MDU opportunities.

"Omniverse continues to believe that its live television service to multi dwelling unit operators is an attractive and economic offering and will continue working with those partners to service the customer segment," the company said.

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— Jeff Baumgartner, Senior Editor, Light Reading