Will The Internet Swallow TV? Ctd

For a small monthly fee, Aereo makes broadcast TV available online (previous Dish coverage here). The Supreme Court has agreed to hear the appeal of major broadcast networks that object to Aereo’s services.  Michael Phillips explains why the case “may determine the future of television”:

To carry network programming, cable and satellite companies normally pay what are known as “retransmission consent fees,” which have come to make up an ever-greater portion of the networks’ revenue. CBS, for instance, pulled its channels from Time Warner Cable last fall while negotiating higher fees. However, Aereo, using a novel interpretation of copyright law, argues that the complex mechanics of its service mean that it doesn’t have to pay.

Under the Copyright Act, you need permission—typically an expensive license—from a copyright holder to show, say, a television program to a large number of people. But the act doesn‘t prohibit showing it “privately” to “a normal circle of family” or “social acquaintances.” This is why you can host a Super Bowl party in your living room without paying an additional fee to whichever network is broadcasting it, or worrying that a lawyer in a power suit will bust down your front door. Because each antenna is assigned to a single subscriber, Aereo claims that it is merely facilitating the sort of individual, private viewership that is allowed by the Copyright Act. …

The putative question before the Supreme Court is whether Aereo is violating the Copyright Act by putting on “public performances” without appropriate licensing. But the Court’s decision to hear the case may signal some sympathy for the networks’ argument that Aereo poses an existential threat to their industry. Out of some ten thousand petitions that the Court receives each year, it chooses seventy-five or so cases to review. Many of these cases earn the Court’s attention because of contradictory rulings between lower courts. As Aereo’s lawyers have emphasized, however, the broadcast industry has pursued its claims against the company in five cases and in three states, and every court that has reached a decision so far has sided with Aereo. This suggests that the Supreme Court has some other rationale for taking the Aereo case. It seems possible that the Court is willing to consider the networks’ argument that Aereo is so dangerous to the broadcasting industry that a review of the matter is of “national importance.”