(The opinions expressed here are those of the author, a
columnist for Reuters.)
By Alison Frankel
NEW YORK, June 25 Every justice on the U.S.
Supreme Court -- the six who joined Justice Stephen Breyer's
majority opinion as well as the three who signed the dissent by
Justice Antonin Scalia -- agreed Wednesday that the television
streaming service Aereo was doing something that shouldn't be
allowed when it intercepted live broadcast signals and
instantaneously relayed them to subscribers' Internet devices.
Top officials at Aereo and IAC/InterActiveCorp, which backed
the service, said the court's decision was a shame for
consumers, but that Aereo's technological model has clearly been
deemed illegal. For that reason, it doesn't make much sense to
belabor the majority's rationale for holding that Aereo's banks
of teensy, subscriber-directed antennas violate the Transmit
Clause of the Copyright Act of 1976.
Aereo's technology is legally dead, and so is the threat
that Aereo will permanently disrupt the business model of TV
broadcasters and cable companies.
DECISION'S LASTING IMPACT
This decision's longer-lasting impact ought to be in
educating other technological innovators about how to avoid
copyright infringement -- except that the majority was evidently
so worried about inadvertently rendering future tech
developments illegal that it completely avoided any such
The Aereo opinion looks backward, not forward, to 1960s and
1970s Supreme Court cases and the subsequent legislative record
they spawned on cable companies that engaged in the same kind of
signal interception as Aereo. When Congress amended the
Copyright Act in 1976, it prohibited cable companies from
selling retransmissions of intercepted broadcast signals without
a license. So, according to Justice Breyer and the Supreme
Court, Aereo is similarly barred, despite technological
innovations -- that permit its subscribers to select particular
shows and to receive unique retransmissions of those shows for
their own private viewing -- designed to skirt the Copyright
"Viewed in terms of Congress' regulatory objectives, why
should any of these technological differences matter?" Breyer
wrote. "They concern the behind-the-scenes way in which Aereo
delivers television programming to its viewers' screens. They do
not render Aereo's commercial objective any different from that
of cable companies. Nor do they significantly alter the viewing
experience of Aereo's subscribers. Why would a subscriber who
wishes to watch a television show care much whether images and
sounds are delivered to his screen via a large multi-subscriber
antenna or one small dedicated antenna, whether they arrive
instantaneously or after a few seconds' delay, or whether they
are transmitted directly or after a personal copy is made?"
Breyer acknowledged at the end of his opinion that the
justices hadn't answered copyright questions about cloud
computing and other unforeseen technologies. He said
circumstances are different from those in the Aereo case when
subscribers are paying for remote storage of copyrighted
content, or when they're downloading content they've already
paid for. (As a side note, it's interesting that Breyer wrote
the decision, because he appeared to be the least tech-savvy of
the justices at oral argument.)
Beyond that, the majority said, the Supreme Court will not
yet venture. "We cannot now answer more precisely how the
Transmit Clause or other provisions of the Copyright Act will
apply to technologies not before us," Breyer wrote. "To the
extent commercial actors or other interested entities may be
concerned with the relationship between the development and use
of such technologies and the Copyright Act, they are of course
free to seek action from Congress."
AD HOC STANDARD
That's not really any help at all, as Justice Scalia pointed
out in his dissent, for Internet services already in operation
and for those that may come later. The "cable-TV-resemblance"
test laid out in the majority's Aereo opinion isn't really a
test at all, Scalia said, but an ad hoc, case-by-case, standard.
"It will take years, perhaps decades, to determine which
automated systems now in existence ... get the Aereo treatment.
(And automated systems now in contemplation will have to take
their chances)," Scalia wrote. "The court vows that its ruling
will not affect cloud-storage providers and cable-television
systems but it cannot deliver on that promise given the
imprecision of its result-driven rule."
Scalia advocates a test for direct copyright infringement
that would be based on the active participation of services like
Aereo: Those that act entirely at the direction of subscribers
would be immune from direct liability but those that influence
users' decisions, like Netflix, could be liable. Even a service
like Aereo, Scalia said, might be indirectly liable for its
users' copyright infringement, but that wasn't the question
before the court in this case.
This is hardly the first time that innovators have been left
without clear answers after the Supreme Court decides a big
case. As a rule, the justices would rather rule too narrowly
than too broadly, leaving lower courts to interpret their
decisions and reach a consensus. That's been especially true in
the court's patent decisions in the last few years, including
this term's opinion on software patents.
But that's little solace for tech start-ups and their
investors, for whom Aereo is a cautionary story without much of
(Reporting by Alison Frankel; Editing by Andrea Evans)