After a New York City-based Internet startup, Aereo, prevailed in the United States Court of Appeals for the Second Circuit earlier this month, major broadcast corporations, Fox and Univision, have hinted at switching their channels over to pay TV.  While the days of rabbit ears and antennas have largely faded away since the analog to digital switch a few years ago, many Americans still enjoy free over-the-air television channels.  Many of our favorite shows can be found on our local ABC, NBC, CBS, and Fox affiliates.  Could these major broadcast corporations really be considering switching their programming over to pay TV?  What brought us to this point?

 

First, let’s take a look at the service Aereo provides.  Aereo provides live streaming of broadcast television, including free over-the-air channels to its customers’ computers, tablets, smartphones, etc.  For a subscription fee, Aereo allows users to record their shows and stream them to their devices at a later time.  Essentially, Aereo allows its customers to turn their devices into televisions with a DVR service.

 

Next, let’s look at the problem Aereo’s service has created for the major broadcasting corporations.  When a cable/satellite provider, such as Comcast or DirecTV want to rebroadcast Fox or NBC’s programming, Comcast and DirecTV have to pay for this privilege.  Major broadcasting corporations allege that Aereo is violating their copyright privileges, specifically the right to perform the copyrighted material (their broadcast) publicly.  The major broadcasting corporations allege that Aereo is publicly broadcasting their copyrighted material, and Aereo needs to pay for this privilege.

 

Aereo’s defense is that it has an array of individual antennas that receive the over-the-air broadcasts, and when a subscriber signs up for its service, he or she is really just renting an individual antenna that streams the broadcast to the subscriber over the Internet.

 

The United States Court of Appeals for the Second Circuit agreed with Aereo and denied the major broadcasting corporations’ petition for a preliminary injunction that would have prevented Aereo from rebroadcasting over-the-air television.  The court held that Aereo’s service did not constitute a public rebroadcast in violation of the major broadcasting corporations’ copyrights.  The court analogized Aereo’s service to receiving the over-the-air broadcast to an individual’s private antenna in their home.  The only difference being that Aereo streams the individual’s broadcast over the Internet, so he or she can watch anywhere.

 

With Aereo’s announcement to expand to 22 more cities by the end of the year, major broadcast corporations are scrambling to find ways to keep their profits.  With the success of Netflix and Amazon’s original programming, major broadcasters are feeling the pressure.  Will this ultimately lead to the end of free over-the-air programming?  Only time will tell.