WASHINGTON -- The U.S. Supreme Court has agreed to hear an appeal from the nation's television broadcasters and decide whether to shut down a new streaming service that sends shows to consumers via the Internet for a monthly fee.
Aereo, a Brooklyn-based start-up distributor, uses small antennas to pick up over-the-air TV signals and allows a consumer to store them for later viewing. The company says its service is entirely legal since it uses the signals that a homeowner with an old-fashioned antenna could pick up as well.
But broadcasters see a major threat to their industry because Aereo is re-transmitting their copyrighted programs and not paying for them. These days, broadcasters depend heavily on revenue paid by cable and satellite companies that carry their signals, and they fear that business model will erode if cable firms are told they can take over-the-air signals for free.
The biggest TV companies, including ABC, CBS, Fox, NBC and PBS, went to court in New York and sued Aereo for violating their copyrights. They cited a provision of the law that gives a copyright holder the exclusive right to "perform the copyrighted work publicly."
But they lost last year when the 2nd Circuit Court of Appeals, in a 2-1 decision, said Aereo "transmits unique copies of broadcasts over the Internet" to individuals, so these are not "public" showings.
Taking their appeal to the Supreme Court, the broadcasters said this decision, unless revised, would "profoundly affect, and potentially endanger, over-the-air broadcast television." Their lawyers said it is "nonsensical" to say that "when tens of thousands of Aereo customers can simultaneously watch the same broadcast of the Superbowl using Aereo" that the company is not "publicly" showing the broadcast.
Lawyers for Aereo agreed the high court should decide the issue now, rather than wait for conflicting rulings from lower courts. They argued broadcasters have to live with the "essential bargain" they made years ago to send out free broadcasts in exchange for use of "public spectrum worth billions of dollars."
The court said it will hear the case of ABC vs. Aereo in late April and issue a ruling by late June.