March 27, 2014 4:39am PT by Eriq Gardner
Aereo Tells Supreme Court Not to Kill 'Next Technological Step'
The countdown begins. With less than a month before TV broadcasters face off against Aereo in a high-stakes showdown that could shape the future of the industry, the upstart digital company filed its last written argument on Wednesday in an attempt to save its business.
Leading up to oral arguments on April 22, both sides have determined that it is in their respective interests to scare the daylights out of the high court justices who will be looking at the legality of a company that captures over-the-air TV signals through antennas and relays those signals to subscribers' digital devices.
For the broadcasters, that means telling the Supreme Court that if Aereo were to prevail, it would upset the balance between programmers and distributors and threaten high-ticket events like the Super Bowl. Not content to let that happen, the justices were informed last month that TV networks would reconsider public broadcasting in the doomsday scenario.
Aereo has words of caution of its own. The broadcasters' interpretation of legislation "imperils the cloud computing industry," says the company's lawyers in the brief filed on Wednesday. "Their position depends on aggregation of all the individual transmissions and individual performances of a program by consumers using Aereo’s system. That 'aggregation' would turn all cloud storage providers into infringers."
Underlying the attempts to steer the Supreme Court toward a ruling that won't shake the present and future of entertainment and technology lies a core disagreement about the Transmit Clause of the Copyright Act and what it means to publicly perform a work.
The broadcasters see what Aereo's system does as a retransmission "to the public" and it's hardly of consequence that neither the antennas set up by Aereo are analogous to the old rabbit-ears nor that each of the company's subscribers get an individualized transmission of a unique copy. What matters instead, according to networks like CBS, Fox and ABC, is that the performances are sent to tens of thousands of viewers online for a profit. That's against the spirit of the Copyright Act, they say, and that interpretation has been echoed by the U.S. government, which seeks to participate in oral hearings next month.
Of course, Aereo has its own interpretation why its system is merely a private performance. It starts with the fact that the company has gone through pains to make sure that each antenna is dedicated to an individual customer getting one copy per transmission. But the argument doesn't end there, as Aereo asserts that its system is just an extension of technologies like the VCR and DVR that have allowed TV viewers to record and watch programming at their convenience.
"The evolution of technology from a black-and-white television connected to a rabbit-ear antenna and a Betamax to a high definition television connected to a digital antenna and DVR has not changed those core principles," says Aereo's response brief. "This case simply concerns the next technological step: allowing a consumer to access broadcast programming using an Internet-connected device coupled with a remotely located, individually assigned antenna and segregated video storage."
The brief then says there is nothing wrong with a Rube Goldberg type system that cleverly takes advantage of existing laws. That's "what companies should do," says Aereo's brief, before moving on to an overview of how we got here -- from the grant of public airwaves to broadcasters, the evolution of the retransmission process, interludes for fair use principles and finally the birth of a company that attempted to put one (antennas) and one (DVRs) together.
In truth, Aereo is not only fighting the broadcasters, but now essentially the U.S. government, as the solicitor general now seeks to participate in oral hearings. The government has attempted to move the high court to a position that knocks Aereo's legality while preserving a future for technologies like cloud computing. But Aereo's brief says that the government's view of how a public performance occurs definitely implicates cloud storage services and is unworkable.
"By its logic, if a consumer uploads an unlawfully obtained copy of a movie to a remote computer and then streams it to herself, the company that provides the storage is liable for a public performance," continues the brief. "To avoid strict liability based on its customers’ actions, the company would have to monitor all of the content stored on its system to make sure it was 'licensed' or otherwise 'authorized.'"
Yes, Aereo believes the Supreme Court's decision will have a huge impact not only on its business, but on the future of technology. As for what the broadcasters believe? Aereo slyly ends its brief with a quotation from CBS CEO Leslie Moonves. If Aereo wins at the Supreme Court, the CBS chief is quoted as saying, "[We] are not going to be financially handicapped at all."
Aereo responds, "That representation belies petitioners’ hyperbolic warnings about threats to 'the very existence of broadcast television as we know it.'"
Below is the full brief.