Broadcasters Petition US Supreme Court In Fight Against Aereo

First time accepted submitter wasteoid writes "Aereo provides live-streaming and cloud-based DVR capability for Over-The-Air (OTA) broadcasts to their paying customers. Broadcasters object to this functionality, with Fox claiming about Aereo, 'Make no mistake, Aereo is stealing our broadcast signal.' The focus appears to be the ability of Aereo to provide streaming and DVR capabilities that traditional broadcasters have not delivered. The litigious broadcasters are fighting against "Aereo's illegal disruption of their business model.""

Comments

NTT in Japan

[musikit]

Living in Japan once in a while someone from NTT knocks on my door asking that i give them money for receiving the signal they broadcast.
my teachers told me about this scam however i tell them two true things

1. i dont have a TV. so im not paying for something i'm not receiving
2. if you don't want me to get the signal then don't broadcast it to me.

same should apply here. the TV stations broadcasted their signal in "cleartext"

Re:NTT in Japan

[roc97007]

Living in Japan once in a while someone from NTT knocks on my door asking that i give them money for receiving the signal they broadcast.
my teachers told me about this scam however i tell them two true things

1. i dont have a TV. so im not paying for something i'm not receiving
2. if you don't want me to get the signal then don't broadcast it to me.

same should apply here. the TV stations broadcasted their signal in "cleartext"

America is an exception when it comes to public broadcast fees. You don't pay for public broadcasting, yet you pay and a lot for cable. Most civilised countries (almost all or all countries in Europe) have a tv license fee, that's used to finance the public broadcasting system. And I think the same applies in Japan.

Let's make sure we agree on the terminology. "public broadcast" to me means the PBS broadcasts (usually one TV channel and one radio channel per area) that are funded by voluntary donations and our tax money (which isn't voluntary). Commercial broadcast TV is funded by selling commercial air time to advertisers. The price for watching broadcast content is to have to put up with the commercials, which presumably affects what you buy, which is valuable to the advertisers.

Let me repeat this, so it's clear: In the US, commercial TV broadcast is funded by advertising time. (And, in part, by selling rebroadcasting rights to cable channels.) That's why it's been classically "free" off-air to viewers. It's a different model from other countries, where you get taxed for owning a TV. The only exception is the US government sponsored PBS channel, which is still "free" to receive but is funded in part by income tax.

It's not clear from TFA whether Aero is cutting out the commercials. If not, they're not affecting that part of the business model. Granted, you may be able to FF over the commercials, but we've been able to do that for decades using various time shifting techniques. (Which the broadcast stations also fought, and lost.)

The "threat" I see, besides TFA's mention of cable companies adopting the same technique and avoiding retransmission fees, is that providing the content on-demand causes the network to lose control of the timeslots and order in which the content is viewed, which, if you read the articles on show popularity amongst various demographics, is very important to the networks. They'll put a poorly performing show sandwiched between two winners to try to pump up the numbers, or put a clear winner in a less popular time slot, or against a winner on a different channel, to try to increase the numbers in that particular slot. I think that's the part of the business model that on-demand destroys.

Actual legal issues aside, it's convenient on-demand that's the real enemy. The networks have already lost the battle for older content (hulu, netflix, et al) but are determined to hang onto their business model for first-run content.

The problem, of course, is that their prime demographic doesn't watch TV that way. The 18-45 crowd expects to watch content on the device of their choosing at the time of their choosing, and that is directly contrary to the network business model. And the networks don't know how to evolve. The primary consumers of the broadcast TV business model, the "tv tray generation" (mostly baby boomers) are dying out. And the networks don't know what to do about that.

The world is changing. The way content is consumed is changing. The way content is *produced* is also changing, which is a different story out of scope of this article. The classic content producers and content distributors are struggling with what to do about this. I submit that this is a good thing.

Re:NTT in Japan

[Jane Q. Public]

"Cable became dominant in the US after people got tired of trying to get a good signal, either in rural areas where the transmitters were distant, or in cities, where buildings caused multipath ghosting and other bad reception. Then people just got too damn lazy (or lived in areas with HOAs that forbade them) to put up antennas. "

You left a really HUGE part out. The part where you paid for cable in order to eliminate the commercials that were the funding source for broadcast. But (as I predicted many years ago), the advertising sneaked back in anyway, and now you're getting dinged at both ends: you still see the commercials AND you're paying $50 or more a month.

Everybody lost but the cable companies. And make no mistake: this did not come about by accident.

Rights?

[AK Marc]

So we have no rights to the content beamed into our homes, but they have the Right to Profit, even with a bad business model.

Re:Rights?

[NoNonAlphaCharsHere]

That argument would apply to television sets themselves. Doesn't hold water.

Re:Rights?

[fuzzyfuzzyfungus]

Aereo has no right to profit from the significant money spent and effort made to deliver the broadcast signals in the first place. Not without compensation.

The courts have so far, begged to differ. In the now-famous CableVision case, the court concluded that Cablevision's offer of a 'cloud DVR' product was legitimate: although Cablevision's hardware was making what would (otherwise) be illicit copies, it was operating as a direct extension of the customer's record and playback requests. Just a DVR; but with the hardware offsite rather than in a set top box.

Aereo specifically designed their service to follow the same model: Aereo operates banks of antennas at their facilities, each customers is allocated(possibly dynamically; but always 1-to-1 at any given time) their own antenna and their own DVR/buffer storage, effectively creating an OTA set top box, just with the video being transported over an IP link, rather than a meter of HDMI cable, and user inputs also going over the internet rather than over IR.

So far, the courts' response has been favorable (if sometimes bemused), in the various markets that Aereo has expanded into. They've been sued in every venue, and prevailed.

Re:Rights?

[bmo]

No, but there are TV repeaters like the VCR Rabbit from the 1980s that are entirely legal, and do exactly what Areo do - rebroadcast taped or OTA (via the VCR's tuner) to another device.

Why was it called the Rabbit? Because it multiplies the video signal.

http://articles.latimes.com/1986-06-22/business/fi-20799_1_rabbit-system

This is merely a VCR plus VCR Rabbit in a cabinet in a data-center paid for via subscription for the service. You could roll out your own rebroadcasting DVR and stick it in a closet or under your TV as part of your media system and pipe the signal back out to the Internet available to only your devices like this does.

--
BMO

'Business Model' is not a protected class

[RandomFactor]

What the station owners fear more than Aereo is the possibility that cable and satellite providers, emboldened by Aereo, will set up their own antenna arrays to avoid paying retransmission fees.

This is exactly WHY this should be allowed. If it is cheaper to setup your own antennas than pay someone else to do it then consumers are being overcharged for the service. Competition should be protected, not the opposite of it.

There is more to it...

[jonwil]

The real reason the broadcasters are doing this is because right now if you dont have an antenna (and many people dont, people in apartments and other shared dwellings, people with no light of sign to the transmission tower etc) the only way to get the OTA channels is to buy pay TV. And the pay TV operators pay a fair chunk of money to the OTA networks for rebroadcast rights.

So what Aereo is doing is allowing a lot more people to get the OTA channels without going through the cable companies (which means the cable companies wont be willing to pay as much for the rebroadcast rights to the OTA networks)

This is nothing more...

[unitron]

...than a case of how far away from your TV your DVR is allowed to be located.

Which is to say the broadcasters are trying to use smoke and mirrors to cover up rent seeking.

So thats how long it takes...

[Anonymous Coward]

I remember before there was FOX network.

When they came along the big 3 had such a hissyfit at them for daring to do something different.

And now here we are.. Fox is having the fit for someone else daring to do something different.

Didn't take very long at all. 27 years to turn you into a stick up the ass 'we demand profits forever for doing the same thing' greedmonster.

Re:Hmmm I wonder...

[fuzzyfuzzyfungus]

I wonder if this isn't a big deal because Aereo isn't rebroadcasting. Broadcasting is transmitting to a wider audience. Aereo has a single antenna distributing to a single person. Obviously this is what Aereo thinks is the case, the stream from my DVR to my TV is not a "rebroadcast." Contrast this with the cable TV operators, who receive the signal once, often through specialized equipment, and send it to all of their local subscribers.

That's the essence of Aereo's legal position(founded on the 'Cablevision Case', where CableVision's 'cloud DVR product, with a similar 'one tuner and storage allocation per user, controlled by the user' was upheld as licit).

Team Broadcast is apparently shitting themselves for some combination of (A) reactionary stupidity and (B) fear that cable companies that currently pay absurd fees to retransmit OTA programming will find it cheaper to set up these goofy antenna-array things than to pay off the broadcasters(which is a pretty good sign that the broadcasters are currently overpaid, if such a silly mechanism actually saves money; but they obviously like being overpaid...)

Retransmission fees are a scam anyway

[DewDude]

If you've ever had your provider get in to a deadlock contract with an OTA station; you'll realize retransmission fees are a scam.

According to the law; a TV station has two options; they can negotiate a retransmission fee for a cable system; or invoke "must-carry", in which the cable provider is *required* to carry them. The station does not have to pay for a "must-carry" station; they are however required by law to carry them. That's bad for the cable company because they have to dedicate QAM space to a channel they may not want. However, if a cable provider negotiates a retransmission fee; they are allowed at that point to insert "local" ads over OTA stations.

In reality; the stations are only screaming about *potential* loss of profits here. The real losers are the local advertisers; who are paying the bills to keep the station's OTA signal running. Thier ads will only get seen by people with OTA; and those times when a local company isn't inserting ads over airtime.

This is why it's common in some areas for a cable/satellite provider to lose the right to carry a local channel. The station wants more money to reach it's demographic; and when a deal cannot be struck, the channel becomes unavailable. If it's a network affiliate; you lose that network entirely. FCC laws prohibit an "outside" station to be piped in to another market. Ironically; this law was made to protect local advertisers, ensuring they had a better chance to be seen in a market where their ads are already possibly being covered over with whatever promotion your provider is running this month.

The ruling that Aereo is legal was upheld by an appellate court already. They found the place-shifting technology (which is what this is); did not constitute public performance. Likewise; since there was an individual receiver and antenna for each user; there was no breaking of any law.

A2B TV does a similar thing; only with satellite TV. And they've even changed since I first found them. Used to be they'd get you set up with a cable TV account at whatever provider was local to the datacenter, along with a slingbox and "hosting space"; thier new model seems to use satellite TV and you have to send them a receiver. I own a Slingbox (two of them actually); and it's perfectly legal to have them hooked up to my TV's; of course I do pay for a TV service. But what about the Slingbox I sent to my friend in Texas with an OTA receiver so I could watch my favorite football team? Legally, it's my receiver and my hardware; so it *still* falls under placeshifting; and it's still not public retransmission.

Networks are going to complain and bitch because they're "getting thier business model stolen"; they seem to forget thier original business model was providing a service for free that was funded by advertisers; that's shifted in to a service that's still provided free, but paid for by cable and satellite companies. I can't blame advertisers for wanting to pay next to nothing; would *you* want to pay top-dollar for advertising knowing the majority of your demographic on cable or satellite might not see it? Of course not.

Again, it's just the networks sitting there looking at the potential profits they're losing because a lousy business model they created failed; one that was doomed for failure in the first place. What were they doing all those years when analog C-Band was still dominate; and they did not scramble the network fee? All those people were watching network TV without local inserted ads. What were they doing before the 1992 act and cable providers could literally pipe in any OTA channel their antenna farm could pick up; you know, back when the FCC mandated providers had to carry locals. Complicate the matter by the fact the FCC has allowed cable broadcasters to begin encrypting OTA feeds; which were once required to be left unencrypted.

The real issue is if they get this declared illicit; what's to stop them going further? They could begin saying multi-room DVR is illegal; worse yet, they coul

Re:Why isn't this libel?

[drinkypoo]

Why is it not illegal for Fox to make this fraudulent claim in a public forum?

Because some of us believe in free speech rights.

It is already illegal to knowingly make false claims, especially of a legal nature, in the public eye — specifically, with the intent to cause harm, which this clearly represents. It is a deliberate attempt to mislead for financial gain and other purposes.