Aereo – No, Really… We’re a Cable Company

In an interesting turn of events, Aereo has decided to, “go with it.”

I’ve been doing a lot of yacking about Aereo over the past few months.  The SCOTUS recently ruled that the company violated broadcaster copyright ownership when it rebroadcast antenna captured OTA signals over the internet, without the appropriate license.  Then the company pushed pause for a bit while it huddled and decided on its next steps.

TV on the Internet

They’ve made a decision. They’ve decided to embrace the ruling.

Wait…!  What?!

Yep. They’ve decided to embrace the ruling.

One of the options that many technologists – myself included – have suggested for Aereo was to pay for a compulsory license.  The only way they would qualify for something like that would be to categorize themselves as a cable company.  Doing so would qualify them to take part in a royalty system setup in the Copyright Act of 1976 that allows cable systems to retransmit copyrighted programming by paying royalty fees with the Licensing Division of the US Copyright Office.  Aereo can pay the fees and won’t need the approval of any broadcasters in order to restart operations.  They basically drop the “FRAND-styled” payment off and crank ‘er up again.

Specifically, Aereo is arguing that

“if [we are] a ‘cable system’ as that term is defined in the Copyright Act, it is eligible for a statutory license, and its transmissions may not be enjoined.”  It’s a compelling argument as, that’s what the type of company the SCOTUS said Aereo was in its original ruling in June 2014.  Aereo added that it’s already begun filing the necessary paperwork to begin paying the royalties in its response to the Second Circuit Court.

The broadcasters involved in the case are, well, in a word – flabbergasted.  In their opinion, Aereo is “astonishing in its presumption” that the SCOTUS transformed them into a cable company, especially since they’ve been arguing from the get-go that they are not.

It’s up to the Second Circuit Court to decide whether to issue an order for Aereo to totally cease operations or allow them to continue operating during the pending trial.

Aereo’s main argument is that the broadcasters can’t have it both ways.  If Aereo’s business model classifies it as a cable company as defined by the SCOTUS ruling and the Copyright Act of 1976, then they should be entitled to the compulsory license under the Act.  It’s clear that the broadcasters don’t want their content pushed over the Internet, and they certainly don’t want it time shifted (via DVR) without a MUCH larger fee from Aereo.  The argument has some legs.  It’s just up to both sides now to make their arguments for or against this new classification.

What do you think?  Is Aereo a cable company?  Should they be closed down during the trial? Should they be eligible for the compulsory license, or should they have to pay a larger royalty to the Broadcasters if they wish to be in business?  Has greed taken the broadcasters too far; or are they entitled to more money? If so, why?  Why don’t you let me know in the comments section, below and tell me what you think?

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