December 12, 2013 / 10:40 PM / 4 years ago

UPDATE 1-Aereo says Supreme Court should take up copyright case

By Dan Levine

Dec 12 (Reuters) - Online television venture Aereo wants the U.S. Supreme Court to review a closely watched copyright lawsuit brought by broadcasting networks that want to shut down the Internet TV startup, which is backed by Barry Diller.

In legal papers filed on Thursday, Aereo said that, even though it won favorable rulings in the lower courts, the Supreme Court should still hear the case and affirm those findings.

Aereo’s announcement came on the same day that Cablevision Systems Corp said the legal theory advanced by broadcasters to the high court would spell trouble for cloud-based content services and threaten Cablevision’s ability to offer DVR recording to its customers.

Broadcasters, including Walt Disney Co’s ABC and Comcast Corp’s NBCUniversal claim Aereo’s streaming service violates copyrights. Aereo does not pay licensing fees to the broadcasters, while pay-TV operators, such as Cablevision and Comcast, shell out billions in retransmission consent fees.

The television industry is closely watching the case to see whether it could disrupt the traditional TV model. The industry sees Aereo and similar services as a threat to its ability to control subscription fees and generate advertising income, its two main sources of revenue.

Representatives for Comcast, CBS Corp and Twenty-First Century Fox Inc declined to comment. Representatives for Walt Disney Co could not immediately comment.

Earlier this year, a federal appeals court in New York refused to shut down Aereo and broadcasters appealed to the U.S. Supreme Court. The high court has not yet said whether it will hear the case.

Aereo subscribers can stream live broadcasts of TV channels on mobile devices using miniature antennas, each assigned to one subscriber. The service was launched in March 2012 in the New York area at a cost to subscribers of $12 per month. The company has since expanded to about 10 cities and plans to enter several more next year.

On Thursday, Aereo filed a legal brief that said the broadcasters, “have signaled their intention to wage a war of attrition by re-litigating this issue in every market to which Aereo expands its business.”

Aereo said the Supreme Court should affirm the principle that, once broadcasters have transmitted content, “consumers have a right to receive and to view that programming using an antenna and to copy that programming for their personal use.”

Like the broadcasters, Cablevision thinks the 2nd U.S. Circuit Court of Appeals should have ruled against Aereo. However, in a white paper released on Thursday, Cablevision argued that the broadcasters were asking the U.S. Supreme Court to go much further and undo the legal underpinnings of cloud-based content services.

Cloud-based computing refers to services that are offered remotely via the Internet.

Under U.S. law, copyright owners have the exclusive right to publicly perform their work. Broadcasters argue that Aereo’s transmissions of television programs while the programs are airing is a public performance of copyrighted works.

According to Cablevision, broadcasters are overreaching in arguing that downloaded content should be considered public performances akin to contemporaneous live streaming. That would impose vast new liability on Cablevision’s DVR service.

“Their approach poses a fundamental threat to cloud technologies,” Cablevision said. “And it would also upset the settled distinction between downloading and streaming.”

The case in the U.S. Supreme Court is American Broadcasting Companies Inc et al. vs. Aereo Inc., 13-461.

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