Calling Aereo a “direct assault” on the broadcast industry's business model, a coalition of TV companies indicated in court papers that Aereo's continued existence could mean
the end of free over-the-air television.
“Aereo has built an entire business around the unauthorized exploitation of broadcasters’ copyrighted content,” broadcasters said
this week. “It seeks to siphon off cable and satellite subscribers by offering this content for a lower fee, which it can do only because, unlike its competitors, Aereo does not compensate
copyright owners for its use.”
The broadcasters add that they partially finance programs through retransmission fees and might “be forced to reconsider” free television
unless Aereo is shut down.
Aereo, a startup backed by Barry Diller, offers paying subscribers the ability to stream television shows to iPhones, iPads and other devices. The company says it
doesn't need a license to do so, due to its architecture, which relies on thousands of dime-size antennas to capture over-the-air signals and stream them to users. Aereo argues that the streams are
“private” -- and therefore don't require licenses -- because they're made on an antenna-to-user basis.
But the TV broadcasters say that the streams are “public
performances,” which require licenses. They argue that the company's “simultaneous retransmission of 'live TV' to paying strangers is no more private than the live retransmissions of cable
and satellite companies,” the broadcasters argue in their Supreme Court papers.
The TV broadcasters contend that Aereo's arguments “are irreconcilable” with copyright law.
“The Copyright Act does not tolerate business models premised on the unauthorized exploitation of the copyrighted works of others,” the networks argue. “Aereo’s massive,
for-profit scheme for exploiting petitioners’ public performance rights is no exception.”
Aereo launched in New York in 2012 before rolling out to other major markets in much of
the country. Broadcasters sued in federal courts in New York, Boston and Utah. Judges in New York and Boston sided with Aereo, but last week a judge in Utah ordered the company to stop operating in
six Western states.
The Supreme Court agreed to hear broadcasters' appeal of a pro-Aereo ruling issued by the 2nd Circuit Court of Appeals. That case is slated for argument on April 22.