When new technology races ahead of the law, judges are often put in the uncomfortable position of judging what the innovation is really doing. Is it something truly different, or a familiar thing done in a new way?
That's the question raised by Aereo, the service that lets people view and time-shift local TV broadcasts through the Internet. The courts have been split over whether to treat Aereo as a new version of cable TV — which, consequently, must pay retransmission fees to broadcasters — or a groundbreaking offer of a TV antenna as a service, combined with a cloud-based digital video recorder.
The Supreme Court has agreed to take up one of the cases that broadcasters have brought against Aereo, so the definitive legal answer to that question should be coming in a few months. Not content to wait, however, U.S. District Judge Dale A. Kimball in Utah has decided that Aereo is the equivalent of cable TV and has shut its service down (temporarily, at least) in six Western states.
Not being a lawyer, it would be hubristic of me to suggest that Kimball got the law wrong here. But I do think he started with the wrong analogy.
Kimball notes that when Congress enacted a major federal copyright law in 1976, one of its purposes was to respond to a pair of Supreme Court rulings that said cable TV operators were free to retransmit broadcast TV programming without paying for it. The 1976 law gives copyright holders the exclusive right to perform a copyrighted work publicly, including the right to transmit the work to the public via "any device or process."
To Kimball, the legal dispute between Aereo and the broadcasters is an easy one to resolve. "Aereo's retransmission of plaintiffs' copyrighted programs is indistinguishable from a cable company and falls squarely within the language of the transmit clause," he writes.
But let's look at the case from another angle. Suppose your neighbor offered to let you put an antenna on her roof so that you could get better TV reception in exchange for a small monthly fee to cover the cost of the antenna and installation. Would that turn the signal coming off your antenna into a "public" performance of the local TV programs? Now imagine she made the same offer to everyone around her (she has a big roof). Would that change the signal coming off your antenna and theirs into a "public" performance?
That's what Aereo is doing. Unlike cable operators, which aggregate programming and sell it to the public, Aereo aggregates antennas. It's offering a (much) more sophisticated version of the hypothetical neighbor with spare real estate on her roof.
In that sense, it's akin to a service Cablevision launched several years ago to replace set-top DVRs. Rather than rent its subscribers expensive digital boxes that could record programs in their homes, Cablevision offered to record programs for them on a server it maintained.
A phalanx of TV networks and studios sued, arguing that Cablevision's new "network DVR" was just a video-on-demand service. As such, they contended, Cablevision needed to obtain licenses from them to copy and retransmit their programs. But Cablevision argued — and the U.S. 2nd Circuit Court of Appeals agreed — that the network DVR was just a DVR done remotely. The recordings were fair-use copies made at the behest of individual users, just like the copies stored on DVRs in homes. And when users played back a recording on the network DVR, it amounted to a private performance, not a public one.
In short, the appeals panel ruled that Cablevision was aggregating DVRs, not copyrighted programs.
Of course, Aereo does more than just rent people antennas. It takes the programs the antennas tune in and transmits them online to the subscriber's home or to a networked DVR for later viewing.
The crucial question, though, is still whether the transmissions made to Aereo users amount to public performances. If the antenna on your roof connected to your home network instead of the back of your TV set, would that turn the signal into a public performance? And if not, would the answer change if the antenna was on your neighbor's roof?
The fact that Aereo transmits TV signals to multiple users across a city makes it look like an online version of a pay-TV service. But if you think of it as aggregating devices — TV antennas, DVRs and Slingboxes — into a service, it's easier to see the end result as a collection of private performances controlled by individual viewers.
Again, the only opinion that really matters on this issue will be the one emanating from the Supreme Court in the late spring or early summer. And how the justices come down will depend on what they think Aereo's disruptive innovation really is.