Supreme Court should rule on Aereo case this week
In a contentious case before the Supreme Court that could be construed as hair-splitting, Aereo’s fate could be decided sometime this week.
The case, on the surface, seems fairly straightforward yet there are a few subtleties upon which the case may be decided.
Aereo offers a service to ‘cord cutters’ (people wishing to discontinue their cable or satellite services in favor of other types of providers) where they basically pay around $8 per month for a dedicated over-the-air (OTA) receiver installed in their geographic coverage area. Subscribers also have access to a cloud-based digital video recorder (DVR). Subscribers can’t access OTA markets outside their immediate area, say for circumventing sports blackouts.
Essentially Aereo is offering subscribers exactly the same thing they would get if they set up their own digital antenna and connected it to a store-bought DVR.
Not surprisingly, all the major networks and Fox, think this is a terribly bad idea. They contend that Aereo is re-broadcasting their content without permission or paying the same fees that cable and satellite providers pay the networks. They also say that by combining the OTA service with the DVR subscribers would be able to skip commercials and therefor broadcasters wouldn’t be able to charge advertisers the same amount.
The case is reminiscent of the networks’ attempts to block the sale of VCRs when they first came out and their later attempts to block the sale of DVRs. In both cases the courts ruled that people have the right to record whatever they want on their VCRs and time-shift all they want with their DVRs – they just can’t re-broadcast those shows or charge people to watch them.
Using the standard end-of-the-world arguments, Fox executive Chase Carey threatened to end over-the-air OTA broadcasts if the Supreme Court ruled in Aereo’s favor. “We will move to a subscription model if that’s our only recourse,” Carey said.
It is interesting to note that when the television industry made the transition to digital broadcasts only back in the mid 2000s the FCC went out of its way to make sure that they weren’t leaving anyone behind and offered coupons for analog rabbit ear users to upgrade to digital rabbit ears. But even with the new rabbit ears not every user was able to pick up local stations.
Aereo’s original idea was to locate digital rabbit ears in optimal locations so users who couldn’t get the full range of stations would be able to access all those free, OTA stations.
So what exactly is the difference between what Aereo does and me renting a digital receiver and DVR at a local Rent-a-Center then mounting the antenna on top of my neighbor’s ham radio antenna for a few bucks a month? Theoretically the OTA broadcasts are free if I use my own antenna (even if I rent it) and the Supreme Court has already ruled that DVRs are legal.
I realize that the networks’ revenues have been slipping for decades (primarily due to fragmentation of the market now that viewers can pick from hundreds of channels) and it is likely to dwindle even more now that online content streaming services are attracting an increasingly larger number of eyeballs every day. But attacking a small company that provides a way for users to access a free service they are already entitled to smacks of desperation.