The U.S. Supreme Court on Wednesday ruled that the online TV service Aereo, backed by media mogul Barry Diller, violates copyright law by using tiny antennas to provide subscribers with broadcast network content via the Internet.
In a 6–3 vote, the court handed a victory to the country’s four major TV broadcasters — Walt Disney Co.'s ABC network; CBS Corp.; Comcast Corp.'s NBCUniversal; and Twenty-First Century Fox — and cast Aereo's immediate future into doubt.
Aereo charges users a low monthly fee to watch live or recorded broadcast TV channels on computers or mobile devices. Aereo does not pay the broadcasters for the right to transmit content.
The court said the service constitutes a public performance of copyrighted content. For the networks, the victory protects the estimated $3 billion in so-called retransmission fees that broadcasters get from cable and satellite TV systems.
Justice Stephen Breyer said in the majority opinion that the ruling should not spell trouble for cloud-based content services in which personal files — including TV shows and music — are stored remotely on the Internet on servers from companies such as Google, Microsoft, Dropbox and Box.
Aereo had argued that cloud services use the Internet in the same way to store and transfer copyrighted content.
The case came before the court after the four broadcasters appealed a decision by the Second U.S. Circuit Court of Appeals in April 2013 that denied their request to shut Aereo down while litigation moved forward.