The Supreme Court is close to ruling on a tussle between television broadcasters and Aereo, a two-year-old company that owns thousands of little, dime-sized antennas in cities across the country. The equipment captures over-the-air signals, then stores the content and streams it to Aereo’s customers, who pay $8 or $12 a month for the service, depending how much content they want.
The plaintiffs in American Broadcasting Companies vs. Aereo say that the company is retransmitting copyrighted programming without paying for it, a violation of copyright law. Essentially, the companies say, Aereo is acting like a cable company, transmitting TV shows to consumers and collecting fees for the service. The difference is that cable companies pay about $3 billion a year for the privilege. Aereo pays nothing.
But Aereo argues that it’s nothing like a cable company; it’s just renting out antennas and cloud storage. After all, a homeowner can buy and install an antenna to tune in local broadcasts, and then record the programs. By that logic, there’s no reason a homeowner should be blocked from renting an antenna and data storage from Aereo—it’s just an antenna with a really, really long cord.
So is Aereo a cable company, or an antenna company? That’s the essence of the decision the Supreme Court has to make. A number of legal commenters are predicting that the Court will decide for the plaintiffs, but using the narrowest possible language, to try to avoid stifling digital innovation, particularly in cloud services. If Aereo wins, the broadcasters could seek help from Congress.
Interested in handicapping the legal back-and-forth? Here’s what you need to know.
The law governing copyrights is a 366-page document that covers everything from printed works to live performances of plays and music to broadcasting. The law protects the copyright holder’s exclusive right “to perform the copyrighted work publicly.” According to Section 101 of the law, that means:
"To transmit or otherwise communicate a performance or display of the work to a place specified by clause (1) or to the public, by means of any device or process, whether the members of the public capable of receiving the performance or display receive it in the same place or in separate places and at the same time or at different times."
A cable company blasts out the same programming to all of its customers, and that’s defined as a public performance. The plaintiffs say that’s what Aereo is doing. The company disagrees, arguing that its customers are individually tapping into broadcasts using the company’s equipment, just the way they would if they bought their own antennas and recording equipment. Under the company’s logic, even if thousands of people watch the same local news program, that constitutes many private performances, not one big public performance.
Another section of U.S. copyright law defines cable companies (which are required to pay retransmission fees) in the following way.
"(3) Cable system.— A “cable system” is a facility, located in any State, territory, trust territory, or possession of the United States, that in whole or in part receives signals transmitted or programs broadcast by one or more television broadcast stations licensed by the Federal Communications Commission, and makes secondary transmissions of such signals or programs by wires, cables, microwave, or other communications channels to subscribing members of the public who pay for such service."
Again, does that accurately describe Aereo? It’s an open question.