Aereo: Double or Nothing — Awaiting the July Ruling

While “House of Cards” has invaded and taken over 44 million households, the American television broadcasting ecosystem could very well be shaken up once again this coming July. That is when the U.S. Supreme Court is expected to make its ruling in a case opposing American television broadcasting giants and Aereo, a company that decided it had nothing to lose.

As was explained in a previous text, Aereo is a company that leases to its clients—for a very reasonable price—tiny antennas the size of a quarter that pick up traditional broadcasters’ signals within the geographical perimeters of traditional antennas. These personal mini-antennas stored in recording and redistribution centres are connected via the Internet to clients’ home-based receivers. It’s a high-tech version of rabbit ears without the trouble of installation or blurry screens.

At the heart of the legal action, two positions are clearly apparent. Aereo positions itself as an individual signal recording and capturing service—providing a service it considers similar to antenna or personal recorder rentals—whereas the consortium of broadcasters (formed by ABC, NBC, CBS and Fox) claims that Aereo is illegally capturing signals (and content) for which it does not own the intellectual property rights, thereby infringing the U.S. Copyright Act. These diametrically opposed positions have rekindled a debate on traditional channels’ five main vectors (i.e., rights, technology, national regulations, new uses and industrial structures) that is far from over. At the heart of potential deliberations are the definition of broadcasting and broadcasting rights, the explosion of the number of available cable packages, data pricing and profitability, the sustainability of local stations that relay signals, etc. But what this case highlights is how broadcasting giants have reacted to the emergence of “small” technology entrepreneurs who count on very skilled attorneys to brilliantly plead their technology’s ideological neutrality and consumers’ right to capture signals that the government provides broadcasters on a privileged basis.

Since 2013, Aereo has won several lawsuits filed against it by CBS, NBC, PBS and other broadcasting giants. Whereas the National Football League and Major League Baseball supportthe broadcasters, Aereo has taken observers by surprise by announcing that it wants the Supreme Court to hear the case and make its ruling as quickly as possible. This situation—although quite rare—is justifiable.

Indeed, Aereo has obtained favourable rulings, including once in appeal. But the same cannot be said of its main competitor, FilmOn X, which has lost practically all of the lawsuits filed against it since it began operating.

Is it because the attorneys representing FilmOn X are not as skilled, because the briefs describing the technology are not as clear, because the executives of both companies have different entrepreneurial styles or because the service offered by Aereo is legal, contrary to FilmOn X’s service offer? One thing is certain: everyone agrees on the need for an umbrella ruling to avoid lawsuits in each market where new services are launched or piecemeal judgments that are testimony to a misunderstanding of the subtle variations in technology.

Furthermore, certain rulings clearly hint at the dissent of some judges who consider that these technological start-ups are looking for regulatory loopholes and concocting technological “contraptions” to shake up the rights and broadcasting system by playing on individual consumers’ rights to capture signals.

After more than a year of lawsuits and mediatised and public bickering following the initial launch of Aereo, some giants are beginning to realize that they also could offer these services or—at the very least—that these services do not negatively affect their profitability. So, fundamentally, who would lose out if Aereo won its case?

Suzanne Lortie
Suzanne Lortie holds a diploma in production from the National Theatre School of Canada as well as a MBA from HEC Montreal. She became a professor at Université du Québec à Montreal in July 2012. She has also worked as a production manager and line producer for television since 1992 (major variety and cultural series that won several Gémeaux and ADISQ awards, documentaries) and is a consultant in new media strategies.
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