Updated: 15:27, Sunday April 7, 2013
A new startup enterprise whose business model is based on tiny antennas receiving over-the-air television for online viewing by subscribers has put the US broadcast industry on the defensive.
Aereo made headlines on April 1 with a preliminary court victory over the major broadcasters, which had sought to shut down the service for copyright infringement.
The case, which is still pending, is seen by some as a potentially groundbreaking test: for consumers, whether they can ‘shift’ TV viewing to the web through a third party; and for broadcasters, whether they can maintain control of their content.
Aereo, which is backed by media mogul Barry Diller, launched in early 2012 in the New York area and was immediately sued by the major broadcast networks – ABC, NBC, CBS and Fox – for copyright infringement.
The company claims its actions are legal, because it is not re-broadcasting, but giving subscribers a personal antenna in its New York warehouse that enables them to watch live TV or record it for later viewing.
A US appeals court panel agreed with Aereo, in a preliminary decision on a request for an injunction to shut down the service. A full hearing in the case is still pending.
The court ruled 2-1 that Aereo was not re-transmitting ‘public performances,’ which would be banned under copyright law, but merely allowing customers to rent antennas to receive and record free broadcasts.
‘Aereo’s system creates a unique copy of that program on a portion of a hard drive assigned only to that Aereo user,’ the appeals court said, upholding a lower court decision.
Chet Kanojia, Aereo’s founder and chief executive, said the ruling ‘sends a powerful message that consumer access to free-to-air broadcast television is still meaningful in this country and that the promise and commitment made by the broadcasters to act in the public interest in exchange for the public’s spectrum remains an important part of our American fabric.’
Some called the ruling a victory for consumers, saying it will allow them to get out from constraints from cable companies, which call the shots for most US TV viewers.
Mitch Stoltz of the Electronic Frontier Foundation called the court decision ‘a win for Aereo, its customers and for future innovators with the audacity to improve the TV-watching experience.’
Stoltz said the ruling ‘gives companies like Aereo an incentive to put TV technology firmly under the viewer’s control.’