Aereo Urges U.S. Supreme Court to Hear Broadcast TV Case

Aereo Inc., the online television service that may upend the economics of the video industry, urged the U.S. Supreme Court to hear an appeal from broadcasters seeking to shut the Internet company down.

In a court filing today in Washington, Aereo took the unusual step of urging review of a decision in its favor. The filing increases the likelihood that the court will take up the copyright case and rule during the nine-month term that will end by early July.

Aereo, which provides broadcast signals to subscribers after capturing them with thousands of small antennas, is aiming to transform the TV business. Barry Diller, the company’s backer, said it may eventually get as much as 35 percent of U.S. households to subscribe if it overcomes legal challenges.

“Because of rapid technological development, this case raises an important issue of law that is better resolved by this court now than later,” the company said in its court filing.

A federal appeals court in New York ruled that Aereo isn’t violating broadcasters’ copyrights. In October, media companies -- including Walt Disney Co. (DIS), 21st Century Fox Inc., Comcast Corp. (CMCSA)’s NBCUniversal and CBS Corp. (CBS) -- urged the Supreme Court to step in.

‘Obvious’ Violation

“This would seem to be an obvious copyright violation -- an entire business model premised on massive for-profit unauthorized exploitation of copyrights where competitors’ prices are undercut because they seek authorization and pay fees,” the companies argued.

NBC, CBS and Fox declined to comment on today’s filing.

Aereo’s service threatens $3 billion in fees that broadcast station owners will receive this year from pay-TV systems to provide signals to subscribers.

Federal law gives copyright owners the exclusive right to perform their works publicly. The appeals court said Aereo’s service was legal because the separate antennas let each customer create a separate copy of a broadcast program for viewing.

“Aereo’s system is used by an Aereo individual user to make a transmission only to himself, not to the public,” the company argued today.

Football, Baseball

The National Football League and Major League Baseball, whose games appear on broadcast TV, are backing the media companies. Cablevision Systems Corp. (CVC) is taking a middle ground, arguing that while Aereo’s service violates the copyright laws, the broadcasters’ arguments go too far and threaten legitimate services.

Under the high court’s normal scheduling practices, the justices will say as early as January whether they will hear the case.

Broadcast stations will collect $3.02 billion in retransmission fees from pay-TV systems this year, doubling to $6.05 billion by 2018, according to estimates by Bloomberg Industries.

The case is American Broadcasting Companies v. Aereo, 13-461.

To contact the reporter on this story: Greg Stohr in Washington at gstohr@bloomberg.net

To contact the editor responsible for this story: Patrick Oster at poster@bloomberg.net

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