NAB: Aereo Decision Means Copyright Theft Not Tolerated

Reaction is swift to eagerly awaited Supreme Court decision.
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Stakeholder reaction came swiftly after broadcasters scored a big victory Wednesday when the Supreme Court ruled that Aereo provides a public performance subject to copyright payments. Not surprising since the industry had been on Aereo watch as the court wound down the session.

"NAB is pleased the Supreme Court has upheld the concept of copyright protection that is enshrined in the Constitution by standing with free and local television," said National Association of Broadcasters President Gordon Smith. "Aereo characterized our lawsuit as an attack on innovation; that claim is demonstrably false. Broadcasters embrace innovation every day, as evidenced by our leadership in HDTV, social media, mobile apps, user-generated content, along with network TV backed ventures like Hulu."

"Television broadcasters will always welcome partnerships with companies who respect copyright law. Today's decision sends an unmistakable message that businesses built on the theft of copyrighted material will not be tolerated."

"What Aereo was doing, was not about technology, it was about theft," CBS President Les Moonves told Bloomberg TV. "Yes, it was a new technology and there'll be others, but right now because of the Supreme Court ruling, people will have to pay for our content."

Fox was understandably pleased.

“21st Century Fox welcomes the U.S. Supreme Court’s ruling, a decision that ultimately is a win for consumers that affirms important copyright protections and ensures that real innovation in over-the-top video will continue to support what is already a vibrant and growing television landscape," the company said in a statement.

Cablevision was relieved that the court preserved its ability to use remote DVR's, which it secured in an appeals court victory that had been cited by Aereo to support its technology.

“We are gratified that the Court’s decision adopted a sensible middle ground, holding that unlicensed retransmission services like Aereo violate the copyright law, while protecting consumer-friendly, cloud-based technologies, such as RS-DVR. The real winner today is the consumer who will continue to benefit from future innovation," Cablevision said in a statement.

“Aereo was using technology, in this case thousands of dime-sized antennas, in a blatant attempt to circumvent copyright law and to profit from broadcasters’ content without compensating them," said Media Institute President Patrick Maines. The instituted had filed an amicus brief in support of broadcasters. "The Supreme Court has struck a strong blow in support of our copyright system.  The Court has affirmed that technological schemes cannot be used as loopholes to avoid paying for copyrighted content.”  

Mark Schultz, co-founder of the Center for the Protection of Intellectual Property at George Mason University School of Law, agreed with Smith that innovation is still very much part of the equation.

"Despite what some are saying, this decision is a boon, not a threat, to innovation," he said in a statement following the decision. "Studios and TV networks are investing hundreds of millions of dollars into new business models and are licensing their creative works to dozens of new entrants. They can now continue to make these innovative investments with greater certainty that they won’t be undermined by overly-technical interpretations of their rights."

SAG-AFTRA was applauding the protection of its members content and business model.

"[T]he U.S. Supreme Court’s decision in the Aereo case... sends a clear and strong message that the Court will not permit companies like Aereo to use inconsequential technical workarounds to evade Congress’ intent to protect content creators and owners in the Copyright Act," the union said. "By adopting a practical analysis that recognizes the extraordinary similarity between Aereo and the cable systems Congress expressly regulated in the Act, the Court rightly focuses on the use of copyrighted works and refused to be sidetracked by the inconsequential technical details with which Aereo attempted to cloak itself. But in doing so, the Court properly limited the scope of the decision so that cloud services and other technological innovations are neither inhibited nor limited. This decision gives the creative community greater confidence that copyright law cannot be so simply evaded and restores the proper balance to the system."

But not everyone was putting out the welcome mat for the Supreme Court majority (the decision was 6-3).

“We’re disappointed that the Supreme Court has ruled to make it harder for consumers to access and watch broadcast television when and where they want," said Ellen Bloom, senior director of federal policy for Consumers Union. "We think Aereo was on to something by filling a need for low cost, flexible viewing options. As cable prices keep skyrocketing, the consumer demand will continue to grow for more personalized, affordable ways to watch television."

"We're concerned that the court's misreading of the law leaves consumers beholden to dominant entertainment and cable companies that constantly raise prices and gouge consumers," said Gene Kimmelman, President and CEO at Public Knowledge. "It is very unfortunate for consumers that the Supreme Court has ruled against Aereo, which has provided an innovative service that brings consumers more choices, more control over their programming, and lower prices."

He even used the decision to get in a shot at Comcast/Time Warner Cable. "This decision, endangering a competitive choice for consumers, makes it all the more important for the Department of Justice and Federal Communications Commission to guard against anti-competitive consolidation, such as the Comcast/Time Warner Cable merger."

The Parents Television Council was not happy.

“We are greatly disappointed with today’s Aereo ruling and we believe that the majority’s opinion failed to reflect the reality of today’s media landscape," said PTC President Tim Winter. "This is a ruling for the status quo that hurts consumers. Aereo had the potential to break up the bundled-channel cable TV model that is forcing Americans to pay higher cable bills year after year for channels they don’t want or don’t watch."

The American Television Alliance did not come to praise or bury the decision, but it had a shovel ready for retrans.

“Today's Supreme Court ruling means that retransmission consent reform is needed now more than ever. The decision is a reminder that broadcasters are interested in only one thing - protecting their government-sanctioned monopolies. The broadcasters' business model, which places blackouts ahead of consumers, is devoid of competition or incentive to innovate.  We encourage Congress to take advantage of the opportunity that the Satellite Television Extension and Localism Act (STELA) provides to update our video rules to the 21st Century, starting with retransmission consent."

The Music First coalition, which has been pushing broadcasters to pay artists--rather than just a blanket license--for radio airplay, called it a pyrrhic victory for NAB. 

"The broadcasters’ victory over Aereo stands for a simple, undeniable proposition – no one has the right to make millions off of someone else’s creative property without paying fair market value for the underlying work," said the group.  Aereo thought it found a loophole around this basic principle, but the Supreme Court rightly refused to elevate form over function and insisted that Aereo pay fair value for the content that is the foundation of its business just like everybody else.

"But as the NAB and its members toast their victory, they may find a sour taste as well.  In their radio business, NAB members commit the exact sin that they condemn in Aereo – they use music as the foundation of their programming, yet refuse to pay the artists and labels who created the music a cent."

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