United States Supreme Court rules against television start-up Aereo

PUBLISHED : Thursday, 26 June, 2014, 1:14am
UPDATED : Thursday, 26 June, 2014, 1:14am

The US Supreme Court dealt what may be a fatal blow to Aereo and its dream of transforming the television industry, ruling that the internet start-up was violating broadcasters' copyright.

The 6-3 ruling is a triumph for broadcast companies, including ABC, 21st Century Fox, NBC Universal and CBS. They said Aereo was threatening the underpinnings of the industry by selling programming online without paying licensing fees.

Aereo sought to give consumers a new way to watch broadcast television without buying the packages offered by cable and satellite companies. Customers in 11 cities have been able to watch live and recorded broadcast programmes for as little as US$8 a month.

Some justices worried during arguments in April that a ruling for the broadcasters could also harm the burgeoning world of cloud computing.

But Justice Stephen Breyer in his majority opinion said that the court did not intend to call cloud computing into question. Justices Antonin Scalia, Samuel Alito and Clarence Thomas dissented.

Breyer said the case "makes clear that Aereo is not simply an equipment provider" but that its "activities are substantially similar to those of the [cable] companies".

"Aereo sells a service that allows subscribers to watch television programmes, many of which are copyrighted, almost as they are being broadcast," he wrote in the opinion.

In a dissenting view, Justice Scalia said that Aereo merely provided a convenient way for internet users to access what would be free broadcast television.

"Unlike video-on-demand services, Aereo does not provide a prearranged assortment of movies and television shows," Scalia wrote.

The top US court reversed a lower court decision in favour of Aereo and sent the case back for further proceedings.

At stake are billions of dollars in fees paid by cable and satellite firms, which Aereo circumvents, in what could be the most significant copyright case in decades.

Aereo, which is backed by media mogul Barry Diller, launched in early 2012 in the New York area.

"It's not a big [financial] loss for us, but I do believe blocking this technology is a big loss for consumers," said Diller.

Associated Press, Bloomberg, Agence France-Presse