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US non-profit consumer organisations Consumer Federation of America (CFA) and Consumers Union (CU) have filed an amicus (friend of court) brief at the US Supreme Court in the case of American Broadcasting Companies Inc. v. Aereo, Inc. F/K/A Bamboom Labs Inc.
The case involves major broadcasters who have sued Internet TV streaming service Aereo for copyright breaches. Aereo’s technology allows subscribers to watch live and recorded programming from over-the-air TV broadcasts on Internet-compatible devices. The case is expected to be heard by the Supreme Court on April 22.
In their amicus brief, CFA and CU explain that “innovative” technologies such as Aereo are entirely legal, benefit consumers, strengthen broadcast distribution, and promote competition.
“This case puts the principle of consumer sovereignty, which has played a critical role in driving innovation and competition in the digital revolution to the test. It could have a major impact on the future of digital distribution of all types of content, not just over-the-air broadcast video,” said Mark Cooper, CFA Director of Research.
“Consumers have the right to decide how and when they watch the TV programmes they obtain legally,” said George Slover, senior policy counsel for Consumers Union. “The Supreme Court has upheld these rights for thirty years, ever since the Sony Betamax decision. We hope the Court will uphold these rights again for the sake of consumer choice and innovation.”
They say the design of the Aereo service is fully consistent with the rights of consumers to enjoy privately a legally-obtained TV programme in ways that meet their needs for flexibility and time management. “These consumer rights have been upheld repeatedly by the Supreme Court, and the design of the service is faithful to the legal structure that governs the use of the public airwaves by broadcasters,” the consumer groups write.
Thirty years ago, the brief states, in the Sony Betamax decision the Supreme Court upheld the fundamental right of consumers to privately enjoy lawfully obtained TV programmes as they saw fit, by recording the programs on a VCR and replaying them whenever and wherever they wanted. “The Court has been asked multiple times to upset the balance struck between consumer rights to private use and copyright holder desires to control the use of lawfully obtained content. The Supreme Court has steadfastly refused to do so, reaffirming that consumer sovereignty and the public interest are key pillars of US copyright law. Enhancement of consumer sovereignty – the ability of consumers to choose to consume what they want and when they want to – has been one of the great benefits of the digital revolution, and one of the primary drivers of innovation and competition in the digital economy,” say the consumer groups.
They say that Aereo and similar services are designed to stay well within the confines of the space the Supreme Court has marked out for consumer sovereignty. The consumer rents the equipment from Aereo, selects the content, pays to store it, chooses when to view it, and must be in the local area to do so.
They contend that Aereo and similar services honour the business model that binds the consumer to the broadcaster, and are faithful to the legal structure that governs the use of the public airwaves by broadcasters. “The consumer pays for the content in exactly the way that consumers have paid for over-the-air broadcasting for over a century, by being exposed to the advertising that pays for the production and distribution of broadcast content. Aereo does nothing to diminish the value of that advertising. In fact, by making the content more attractive to more consumers, because they can view it more conveniently, Aereo increases its value to advertisers, making broadcasting better able to compete in the video market,” they state.
They suggest that Aereo and other similar services allow consumers to exercise their right of private viewing in a flexible and cost-effective way, utilising the most up-to-date technologies to deliver it: the Internet cloud, WiFi technology, and distributed computing capacity. These technologies are perfect examples of the Sony Betmax principle in practice.
The brief warns that, were the Court to declare illegal this technological innovation that has been carefully designed to stay within the bounds of existing law and business relationships, it would have effects far beyond Aereo and it subscribers, and could rip the lid off a Pandora’s Box of copyright litigation. Every cloud computing application could be at risk, challenged because a third-party intermediary inevitably stands between the copyright holder and the consumer.