A judge has denied request from broadcasters for an injunction against mobile TV startup Aereo.
Aereo offers a monthly subscription service that allows users in New York City to watch live broadcast television on any device, including smartphones and tablets.
American Broadcasters and WNET filed two complaints against Aereo in March alleging that its service unlawfully captures broadcast television signals in the New York City area and provides them over the Internet to subscribers, including some corresponding to television programs for which Cablevision holds the copyright.
Federal Judge Alison Nathan said in her Thursday ruling (http://www.nysd.uscourts.gov/cases/show.php?db=special&id=196) that the decision to deny the request for an injunction was probably unfair to broadcasters because they are not being compensated for use of their programming, but cited a precedent-setting ruling in favor of Cablevision. That decision held that that Cablevision's remote storage DVR system did not infringe on public performance rights under the Copyright Act.
Aereo argued that like Cablevision, it effectively rents to its users remote equipment comparable to what these users could install at home, and that that equipment is identical to Cablevision's.
"Faithful application of Cablevision requires the conclusion that plaintiffs are unlikely to succeed on the merits of their public performance claim,” Nathan wrote in her ruling.
Broadcasters argued that the Cablevision ruling does not apply, calling Aereo's system a "technological gimmick, or a "device or process" through which Aereo passes along copyrighted content to the public.
Specifically, the broadcasters tried to distinguish Cablevision on its facts, arguing that because Aereo's subscribers are watching these programs as they are still being broadcast, they are not using the copies Aereo creates for "timeshifting" and these copies therefore do not "break the chain of the transmission" received by Aereo.
Judge Nathan conceded that her ruling would harm broadcasters. She said that viewers lost to services like Aereo's would not be represented in viewer numbers shown to advertisers, essentially undercutting a broadcaster's ability to negotiate higher rates for advertising on thier programming.
The ruling is technically still pending and the broadcasters involved in the case said they will appeal immediately.
Aereo has remained a rather small startup and is limited to the New York City. It started with about 100 subscribers and has since grown to more than 3,500.
Still, legal decisions about whether Aereo is allowed to operate are expected to have broad implications for the state of broadcasting as mobile business models continue to disrupt traditional cable and broadcast providers.