Published On: Wed, Jun 25th, 2014

Barry Diller Will Likely Shut Streaming Service Aereo Down After Losing At Supreme Court



Barry Diller Headshot_Final

 

Aereo, Barry Diller’s streaming video startup, will probably now have to close its doors after a decision today by the United States Supreme Court stating the company’s fundamental modus operandi was in violation of US copyright laws.

To date Aereo has already been made available in more than a dozen American cities. Aereo’s technology plucks what are the traditionally free-over-the-air broadcast television signals out of the ether, using thousands of dime sized antennas, and then streams them over the internet to their subscribers computers on an as-demanded basis, without complicated and expensive packages, for less than ten dollars a month. The service also includes DVR capabilities.

The Supreme Court began to hold hearings on the case in April after cable companies, broadcasters and content production companies had lost their bid to block the service in appeals court.

The broadcast television networks, and cable companies have argued that looking past the technology to the obvious market facts, then what Aereo is doing is simply re-transmitting their signals which is illegal on a group basis.

Aereo’s argument had been that by using thousands of tiny individual antennas stacked in warehouses their technology is entirely “one-one”, which is perfectly legal, rather than “one-many”, which is proscribed.

With its decision today the Supremes have now said, by a decision of 6 Justices to 3, that Aereo’s customers constitute “the public, ” and that retransmitting of television networks’ copyrighted material using Aereo’s technology goes against the plaintiffs’ exclusive right to perform their works publicly as the holders of the copyright. Justice Breyer wrote the majority decision and was joined in his opinion by five others; Justices Roberts, Kennedy, Ginsburg, Sotomayor, and Kagan.

Their opinion reads, ”We must decide whether respondent Aereo, Inc., infringes this exclusive right by selling its subscribers a technologically complex service that allows them to watch television programs over the Internet at about the same time as the programs are broadcast over the air, ” sand the decision comes to the denouement as follows, ”We conclude that it does.”

Justices Scalia, Thomas, and Alito, perhaps the three most conservative judges on the bench, were the three dissenting Justices. They argued that Aereo’s digital transmissions do not constitute a “performance” and, as such, the plaintiffs had no standing to bring the case.

Justice Scalia wrote for the minority that the claim by the broadcasters that Aereo directly violates their copyright “fails at the very outset because Aereo does not ‘perform’ at all, ” adding “The Court manages to reach the opposite conclusion only by disregarding widely accepted rules for service-provider liability and adopting in their place an improvised standard (‘looks-like-cable-TV’) that will sow confusion for years to come.”

Neither Aereo nor Barry Dller has yet made any comment on this decision. However previously one of its founders, Chet Kanojia, had said “There is no plan B, ” indicating a loss would bring about the end of their story.

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