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That's one hell of a broad patent, clearly made for DVD/Tapes/TV and now being abused on the Internet.
They could easily beat this... the video technology the Industry uses today does not use 'pictures' to break up the display of the clip. They uses video rolls/screenshots which play a mini segment of the video and it's one thing, not each unique parts. As well, hardware does not generate ours, software does.
That's just looking over quickly...
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