April 22, 2014
Industry News

Future of TV on Trial

U.S. Supreme Court justices press streaming startup Aereo on retrans rights and show concern about hampering cloud-based business growth in pivotal case.

Juliana J. Bolden
United States Supreme Court justices asked an attorney for Brooklyn, N.Y. streaming startup Aereo to explain why the company is not breaking copyright law by retransmitting local television station signals to paying customers sans license. 

Today's oral arguments are the culmination of a two-year legal standoff between Barry Diller-lead Aereo and a legion of national broadcasters (American Broadcasting Companies v. Aereo).

The high court's ruling in this case may carry sweeping changes for the televison and tech sectors — literally, for the way everyone watches television — and is expected in June.

Aereo is a service that takes television signals from the airwaves and enables their paid customers to stream and record programs online via computers and mobile devices.

Subscription plans are available for $8 per month and up in 11 cities: New York, Boston, Miami, Atlanta and Houston, among others. Subscribers are currently able to play shows back on most popular web browsers, iOS mobile devices, Roku and Google Play.

Praised by some cord-cutting customers as a low-cost alternative to conventional cable television services such Comcast and Cox, a Supreme Court victory for Aereo may spur more cable-alternative players.   

No praise from broadcasters though. They believe Aereo is stealing their programming via unauthorized streams, undercutting billions of dollars in vital retransmission fees paid to networks by cable and satellite companies for use of their content.
 
As a way to work around U.S. copyright law, Aereo set up its operation so that no two subscribers share the same antenna or the same recording — and is therefore, the company said, not providing a public transmission. A split U.S. appellate court in New York rejected a bid to shutter the company in 2013. 

Though broadcasters have a solid shot at prevailing, according to those looking at such cues as Chief Justice John Roberts' concerns that Aereo services were specifically designed to circumvent current U.S. copyright parameters, some legal experts are hesitant to call one side or the other.

The case is a tough one Justice Sonia Sotomayor said, because a decision against cloud-based Aereo may have adverse effects on more established cloud-based services, such as Apple TV, Hulu, Amazon and others.



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