The U.S. Supreme Court in a 6-3 ruling has junked the claims of Aereo Technology, a start-up tech company, citing copyright violations.
The court noted Aereo's service violated the Copyright Act by playing back recordings of broadcasters' TV shows despite the legitimate nature of capturing those shows over the air. If Aereo had won the case, it would have created a new history in TV and cable industries.
The verdict was a big blow to Aereo's claims of using technology as a cheaper way of watching TV. Broadcasters are rejoicing that the leverage over the deployment of new technologies will not hit the broadcasting industry.
Aereo argued it was providing technology and its subscribers were renting it to watch TV and the viewers were responsible for playing back those recordings.
The justices suggested TV broadcasters have an exclusive copyright over the programs they transmit. Aereo stood by its claim it had the right to capture and send TV signals to customers over the Internet without paying licensing fees to broadcasters.
Justice Stephen Breyer cited the history of Copyright Right Act of 1976 preventing the then-new cable companies from capturing TV signals with an antenna and sending them to homes without paying broadcasters.
The law had mandated that cable companies to pay licensing fees to capture and send broadcast signals. That rule prevailed until Aereo came up with tiny antennas being rented to customers to capture signals. It wanted individuals to watch their favorite TV shows for less money than what they have to pay cable companies.
The justice noted Aereo was behaving like a traditional cable system. In the light of the express purpose in amending the Copyright Act, it is mandatory that cable and satellite companies to pay licensing fees before transmitting copyrighted TV signals. In that context, Aereo is not above the law.
The ruling reinforced the sanctity of copyright. Chief Justice John Roberts and four other judges agreed. The dissenters were not convinced how Aereo was violating the Copyright Act. They cited the clause public performances and wondered how sending TV signals to an individual customer could become a public performance.