WASHINGTON — Confronting a case that could reshape the television broadcast industry, Supreme Court justices sounded conflicted Tuesday over whether an upstart streaming service is violating copyright laws by enabling subscribers to record programs captured over the air and view them later on the Internet.
The court's ruling, due by June, could either shut down New York-based Aereo or clear the way for the growing company to continue providing subscribers with a convenient, low-cost way to watch local broadcast channels without paying for cable or satellite service or putting an antenna on a roof.
Aereo's service immediately grabbed the full attention of the TV broadcast industry, which accused the company of effectively stealing content and reselling it. The streaming service — which began in New York and has expanded to 10 other cities — may give consumers more options for TV viewing, but it also upset the system of licensing and retransmission fees that help support the broadcast industry.
Before Tuesday, most legal experts predicted that the court would rule against Aereo. But justices did not lean strongly in either direction during arguments. Most sat back and listened, and several seemed to be struggling with how to incorporate the new technology into existing copyright laws.
Cable companies are siding with Aereo, largely because if the company wins, they will be able to use similar methods to capture local broadcasting signals, avoiding the billions of dollars in fees they pay to local channels for retransmission rights.
Two veteran Washington attorneys, Paul Clement and David Frederick, presented the contrasting arguments in the case,
Clement, a former solicitor general who represented television network ABC and other broadcasters, called Aereo a "gimmick" that allows "thousands of paying strangers to watch live TV online" without paying a licensing fee to the broadcasters for their copyrighted programs.
This violates the Copyright Act of 1976, he said, adopted in part to deal with the advent of cable TV service. Broadcasters were given an exclusive right to any program that is "publicly" performed or transmitted to the public "by means of any device or process." This could describe a cable TV tower, and it also describes Aereo precisely, he said.
But Aereo came up with what some say is an ingenious way around the law. It denies that its service amounts to a "public" airing of programs, but is merely a new way for individual consumers to watch programs they could see for free.
The service works like this: In New York, subscribers rent a tiny antenna devoted to their own individual use at a
"It's no different than if I'm at home, and I have an antenna or rabbit ears on my TV, and I know what channels I can get," Frederick said. "Consumers have a right to get over-the-air signals that are free to the public," he added.
He likened Aereo to the 1980s-era video recorders that allowed consumers to record copies of programs to be viewed at home. In 1984, the high court ruled that recording programs at home for later viewing did not violate copyright laws.
Justice Department attorney Malcolm Stewart, in a brief appearance, said the government agrees with broadcasters that Aereo is violating copyright laws by transmitting broadcast signals without a license. Among the broadcasters urging the court to shut down Aereo is
Aereo charges as little as $8 a month for its service and allows subscribers to store 20 hours of programming or more for later viewing. Besides New York, it is now available in Baltimore, Boston, Atlanta, Detroit, Cincinnati, Miami and several cities in Texas.