The Supreme Court agreed Friday to decide a high-stakes dispute between the nation’s broadcast networks and an upstart Web company that is providing live television programming over the Internet.
Both the networks and Barry Diller-backed Aereo asked the justices to settle the legal fight that could radically change the way live television is delivered to American consumers and disrupt an economic model that accounts for billions of dollars in fees for the broadcasters.
The networks say Aereo violates a part of the copyright law that requires network permission for the right to transmit to the public “public performances” of their work. The networks receive more tha $4 billion in annual fees from satellite and cable companies for the right to rebroadcast the material.
But Aereo uses a multitude of small antennas to capture live over-the-air television signals and directs them to subscribers, where they can be watched on computers or other devices. It contends it is not transmitting the program to the public, but only allowing an individual to capture what is available free over the airwaves. A panel of the U.S. Court of Appeals for the 2nd Circuit agreed with Aereo.
That decision “is threatening the very fundamentals of broadcast television,” the broadcasters argued in their appeal. They said the ruling blesses a business model based on the “massive, for-profit exploitation of the copyrighted works of others.”
Aereo founder and chief executive Chet Kanojia said when the company asked the high court to take the case that its technology “is functionally equivalent to a home antenna and DVR.”
After the court accepted the case, the company said “We have every confidence that the court will validate and preserve a consumer’s right to access local over-the-air television with an individual antenna, make a personal recording with a DVR, and watch that recording on a device of their choice.”
Aereo is currently available in 10 cities, including New York and Baltimore, and its Web site says it is looking to expand to Washington. Memberships start at $8 a month.
The broadcasters’ petition to the court mocked the company’s argument that it was catering only to individuals.
That argument would mean that “when tens of thousands of Aereo subscribers all simultaneously watch the same broadcast of the Super Bowl using Aereo, Aereo is not publicly performing the Super Bowl,” the petition said. “It is merely making tens of thousands of simultaneous ‘private’ performances to its subscribers.”
The case is American Broadcasting Companies v. Aereo.