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The U.S. Supreme Court announced today that it will hear the potentially landmark case between scrappy startup Aereo and broadcast media companies — setting a court date of April 22.
The case is being watched very closely by TV industry observers. A ruling in favor of Aereo could be seen as a win for consumers who don’t want to subscribe to an expensive cable or satellite TV service. It may also be a win for those operating TV services, as they would be free to adopt a strategy similar to Aereo to avoid paying licensing fees.
Aereo’s service allows consumers within a local region to stream and record video content that’s freely broadcasted over the air. It does this by using tiny antennas for each person that subscribes to its $8 monthly service, provided they live within a local market where Aereo is available. Big media companies that own broadcast TV stations (ABC, NBC, CBS, Fox, etc.) really really don’t like Aereo’s business model because Aereo doesn’t pay content licensing fees like cable TV providers and online services such as Netflix and Hulu do.
Media companies have said that if services like Aereo are allowed to continue, they’ll rip broadcast programming off the air and become cable networks, which is implausible as VentureBeat previously pointed out. Also, big media has taken Aereo to court on several occasions, each time ending with judges clearing Aereo of any wrongdoing. However, those media companies believe the high court will rule in their favor this time and force Aereo to shut down or pay licensing fees for the use of that their content.
Aereo, however, is confident the Supreme Court will reaffirm ruling from lower courts. It even issued a bold statement urging the court to hear the case. And it seems the odds are actually in the startup’s favor.
Justice Samuel Alito has recused himself from hearing the case, according to ScotusBlog. That means he may have some sort of financial conflict of interest associated with the outcome. Should there be a tie between the remaining justices, the lower court’s ruling would remain intact — thus handing Aereo a win.
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