Aereo’s biggest day in court has finally arrived and it’s win or die.
Opening arguments in American Broadcasting Companies, Inc. v. Aereo, Inc, a landmark case that could forever alter how U.S. citizens watch TV -- and how American cloud storage companies do business -- kick off at the U.S. Supreme Court today.
After beating them twice already in lower courts, Aereo is once again facing off against the royalty-hungry broadcast TV goliaths dead-set on shutting the small, literally disruptive streaming TV newcomer down for good.
TV’s Big Four (ABC, CBS, NBC and Fox), along with Comcast Corp. and Walt Disney Co., claim the New York City-based startup is violating U.S. copyright law by streaming their copyrighted content to its customers without paying a penny for it. According to them, Aereo is outright stealing and illegally distributing their free-to-air programming on a massive scale.
Aereo’s CEO Chet Kanojia says that’s just not so, that his cloud-based streaming service “falls squarely within the law” and that this case isn’t even about copyright law.
“It’s a case about trying to protect this idea of an integrated bundle that the media companies sell,” he told Entrepreneur.com earlier this month. To him, the copyright infringement accusation is little more than a red herring.
Kanojia’s controversial 2-year-old service delivers broadcasters’ free, local over-the-air content to its subscribers via a sophisticated tiny antenna and DVR system. Its game-changing technology allows subscribers to watch and record live broadcast TV on their smartphones, tablets and internet-connected TVs (for $8 to $12 per month).
Nothing about that is illegal, Konjia said, because “every consumer has the right to an antenna” and “every consumer has the right to make a recording for themselves of free-to-air television.”
Cloud-based storage companies like Dropbox, Amazon and Google will be watching the case very closely. If the court rules against Aereo, it could mean that firms like these that do business in the cloud are potentially violating copyright law by providing their users with copyrighted content, even if the user owns it.
Kanojia said he has "no choice" but to be confident Aereo will again prevail against corporate network TV’s old guard, this time in our country's highest court, just as it did once in federal district court and twice in the Second Court of Appeals.
If Aereo doesn’t win, Kanojia has no Plan B. If it does, media mammoths (including major sports organizations like the NFL and MLB) have said they would yank their free content from the airwaves. They threaten to move their programming to cable channels, which would choke off a major chunk of Aereo’s content. Kanojia thinks broadcasters are bluffing, casting their threats off as mere “rhetoric.”
Only time, and a highly anticipated Supreme Court final ruling in the case, likely in June, will tell.
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