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Aereo under fire at Supreme Court

Online streaming service Aereo faced a barrage of criticism from chief justices as the latest round in its legal battle with broadcasters began at the US Supreme Court.

Aereo allows subscribers to watch TV channels on mobile devices using a personal antenna but does not pay licensing fees to broadcasters, which has sparked a furious legal row with the likes of Fox, ABC, CBS and PBS.

Broadcasters fear the model could threaten the distribution fees they receive from pay TV platforms.

The case has gone all the way to the Supreme Court, where chief justice John Roberts said yesterday that Aereo’s model had been based on “circumventing legal prohibitions you don’t want to comply with.” Justice Sonia Sotomayor added that the company’s description implied it was a cable company and should therefore be paying fees.

“You are the only player so far that doesn’t pay any royalties at any stage,” added Justice Ruth Bader Ginsburg.

Aereo claimed that its ‘personal antenna’ method of content delivery excludes it from paying license fees, as copyright laws are not applicable because the TV show is a “private” performance.

The justices also voiced concerns that any ruling should consider the effect on how other company’s store information on remote online networks to avoid stifling innovation.

David Frederick, counsel to Aereo, said outside the Supreme Court after the first day of hearings that the final decision would have far-reaching consequences for cloud computing and that the company remained “cautiously optimistic” of victory.

Frederick said: “From our perspective, the issue in the case was whether consumers who have always had a right to have an antenna and a DVR in their home and make copies of local over-the-air broadcast television, if that right should be infringed at all simply by moving the antenna and DVR to the cloud.

“The court’s decision today will have significant consequences for cloud computing. We’re confident, cautiously optimistic, based on the way the hearing went today, that the court understood a person watching over-the-air broadcast television in his or her home is engaging in a private performance and not a public performance that would implicate the Copyright Act.”

Aereo, which was backed by former Fox chief Barry Diller at its 2012 launch, has previously stated that viewers have a “fundamental right” to watch broadcast TV via an antenna as well as recording copies for their personal use. It cited the Supreme Court’s decision to allow the introduction of Sony Betamax tapes in 1984, which enabled viewers to record shows at home.

Aereo previously defeated an attempt in Massachusetts to block its roll-out but more recently suffered a defeat in Utah, bringing about an injunction in six states. The US department of justice also sided with the networks.

Aereo has previously welcomed the chance to state its case in the Supreme Court, with founder and CEO Chet Kanojia saying he wanted the matter “resolved on the merits rather than through a wasteful war of attrition.”

The firm operates across the US and charges customers between US$8 and US$11 per month to watch live TV on the internet or mobile devices, or store shows to be played back later. It recently launched in San Antonio, which became the 12th city to gain access to the service.

The company, which received US$34m in funding from investors including veteran media backer Gordon Crawford in January, has said it would struggle to continue if the court decision goes against it.

A decision is expected in June.

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