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Aereo’s Fate in Supreme Court’s Hands

7 May, 2014 By: Doug McPherson

WASHINGTON – The United States Supreme Court hosted the biggest names in TV in late April to finish hearing arguments in American Broadcasting Companies Inc. vs. Aereo Inc. and is expected to issue a decision in June.

Analysts say that decision stands to leave a Grand Canyon-sized impact on how Americans consume TV, regardless of who wins.

Aereo has been charging customers $8 a month to rent an antenna that offers local channels and cloud DVR service, which is then streamed live to smartphones, tablets and computers. Broadcasters say that violates copyright law – that re-broadcasting content from the airwaves via the Internet is a crime.

David Oxenford, an attorney who represents broadcasting and digital media companies, says counsel for Aereo tried to argue that the retransmission of broadcast signals within the service area of television stations were, under the Copyright Act, acts that were not compensated by other carriers including cable and satellite, as he claimed that those services paid no fees for the local reception of their services in their markets. While disputed by counsel for broadcasters, Aereo’s counsel did not dispute that the public performances embodied in retransmissions by both cable and satellite are covered by a license – usually a compulsory license, but a license nevertheless.

“The crux of Aereo’s argument is that it is just like a piece of rented equipment that allowed users to choose to send television programming to themselves,” Oxenford writes in ”As it is an individual sending a performance to him or herself, the transmissions are argued to be all private performances, not public performances needing permission of the TV stations and copyright holders. Aereo’s brief and its counsel tried to press the point, and to argue that a ruling against Aereo would be a ruling against any sort of cloud service, many of which claim to rely on private performances to avoid certain copyright liability.”

James Kang, an intellectual property attorney in New Jersey, says the outcome “could dramatically shape the future of television.”

“Based on the oral arguments, the justices appeared to view Aereo’s system of individual antennas and DVRs as technology specifically designed to sidestep copyright infringement issues, and seemed dubious about the legality of Aereo’s system,” he says.

Kang adds an Aereo victory “could change the landscape” of broadcast television, as some broadcasters have already threatened to halt broadcasts of over-the-air content if Aereo’s technology is ruled to amount to private performances. Conversely, a broad ruling in favor of the broadcast industry could unleash a “polar vortex” upon the cloud computing industry.

“Lots of issues came up during the course of the argument, and it will be very interesting to see how the court resolves these in its final decision,” Oxenford says.

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