Apex Court of United States in a landmark Judgement had ruled that online TV service Aereo violated copyright laws by resending signals of TV channels without paying licence fee.
In its verdict, the apex court held that the Aereo needs to pay transmission fee to broadcasters for transmitting their content.
The court rejected Aereo’s argument that it was different from cable and satellite services because each subscriber was assigned an individual, dime-sized antenna.
The judgement puts Aereo’s existence in threat and is a major victory for broadcasters who had warned that if Aereo was allowed to retransmit channels without paying transmission fees, others would also follow suit which would be detrimental to their revenue.
The Walt Disney Company’s ABC network, CBS Corp, NBCUniversal and Twenty-First Century Fox had appealed against a 2nd U.S. Circuit Court of Appeals decision in April 2013 that turned down their request to shut down Aereo.
Aereo allows subscribers to view live and time-shifted streams of over-the-air television on Internet-connected devices. The service was launched in February 2012 and is backed by Barry Diller’s IAC.
What is Aereo
Aereo basically uses small, cloud-based antennas to grab over-the-air television broadcast, which it then makes accessible via the Internet.
Until now, watching free, over-the-air television required a giant rooftop antenna or awkward rabbit ears. Aereo changed all that. Now, your TV antenna is unbelievably small. So small it can fit on the tip of your finger. But it still gets awesome HD reception. Your antenna is in the cloud. With lots of other antennas, all connected to DVRs and super-fast Internet connections.
For $8 a month, users can watch non-cable TV, live on any device, or DVR those shows for later viewing. So far, the service is only available in 11 U.S. cities.
The company rents space in a warehouse in Brooklyn and fills it with custom-made, wine cooler-sized computer hardware jammed with vertically aligned blades. Projecting from the blades are thousands of thumbnail-sized television antennas. These are tiny, modern-day versions of the old bunny ears that people have used to watch over-the-air television since time immemorial.
Aereo then effectively rents each customer one of these antennas and all the other off-site hardware needed to operate her own individualized remote DVR using her Apple (AAPL) iPhone or iPad. As with most DVRs, the customer can choose to watch live (with a pause-function available) or watch later. The signal reaches the customer's device over the Internet.