From The TV IV
A broadcast flag is a signal embedded in the digital data stream of a television program that may contain restrictions on how the program can be recorded by a digital video recorder or other device. Such restrictions include the inability to transfer the program off the device into a computer or other digital medium; the reduction of the recording quality from high (digital) to standard (broadcast) quality; or a time-limit set on to how long the program will be kept in the DVR. A flag may even prevent the program from recording at all.
As of 2005 all receivers were supposed to accept this functionality, but the FCC rule was struck down by a federal court. The rationale is that the Federal Communications Commission only has the authority to regulate communications, not devices that receive them. Attempts continue to be made to enact the broadcast flag into law, such as including it as riders to other laws.