The Supreme Court on Wednesday ruled in favor of TV
broadcasters against Aereo, according to THR.
In a 6-3 decision, the high court led by Justice
Stephen Breyer determined that Aereo publicly performs copyrighted work and has
reversed the 2nd Circuit holding. The case has now been remanded, where the
broadcasters look primed to score an injunction that will shut down the
service.
According to Breyer's opinion, the "behind-the-scenes
technological differences do not distinguish Aereo's system from cable systems,
which do publicly perform."
Aereo is a subscription digital service that allows users to
watch or record live broadcast TV using a PC or cell phone. It was introduced
to the public in February 2012 by its biggest financial backer Barry Diller,
who at the time proclaimed that Aereo would pry over-the-air broadcast
television out of a closed system.
The following month, just as Aereo launched
in New York, all of the major TV broadcasters took Aereo to a New York federal
court to face charges of violating copyright law. With the ultimate outcome of
the case pending, Aereo has expanded its operations to more than two dozen
markets.
The plaintiffs contend that Aereo steps on the broadcasters'
public performance rights under the 1976 Copyright Act, which requires a
license for retransmission. Aereo, however, has maintained that its dime-sized
antennas are analogous to old rooftop antennas, and that users direct the
system to pass along unique copies of programming, akin to the private
performance afforded a remote-storage DVR.
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Aereo has maintained an unfavorable ruling would be a death
knell for the company. Broadcasters, meanwhile, had threatened to stop
providing their channels over the air, as they looked to protect the lucrative
affiliate fees they receive from pay-TV providers.
Broadcaster shares have moved higher following the verdict:
CBS +5.4%. DIS +1.4%. FOX +2%. FOXA +1.9%. CMCSA +0.9%. InterActiveCorp (IACI
-1.6%), a major Aereo investor, is trading lower.
