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US Supreme Court rules in favor of copyright, against online TV

WASHINGTON--A startup that captures over-the-air television for Internet viewing violates copyright laws, the U.S. Supreme Court said Wednesday in a landmark ruling affecting the tech and TV industries.

The court ruled 6-3 that Aereo illegally retransmits broadcast signals, dismissing claims that its tiny personalized antennas merely allow customers to watch or record what would be free TV programs.

Some major tech groups had argued for Aereo, saying its innovative technology opened up more choice for consumers, while the television industry maintained the service was simply theft of its programs.

Justice Stephen Breyer wrote in the majority opinion that Aereo effectively operates like a cable company and must therefore pay for broadcast rights.

Breyer said the case “makes clear that Aereo is not simply an equipment provider” but that its “activities are substantially similar to those of the (cable) companies.”

“Aereo sells a service that allows subscribers to watch television programs, many of which are copyrighted, almost as they are being broadcast,” he wrote in the opinion.

The top U.S. court reversed a lower court decision that had been in favor of Aereo, and sent the case back for further proceedings, which could determine penalties.

At stake are billions of dollars in fees paid by cable and satellite firms, which Aereo circumvents, in what could be the most significant copyright case in decades.

Aereo, which is backed by media mogul Barry Diller, launched in early 2012 in the New York area and was immediately sued by the major broadcast networks — ABC, NBC, CBS and Fox — for copyright infringement.

The company, which is expanding to other cities, says its actions are legal because it is not rebroadcasting, but giving subscribers a personal antenna in its New York warehouse that enables them to watch live TV or record it for later viewing on computers or mobile devices.

Even though consumers may watch broadcast television for free with their own antennas, a cable or satellite firm which retransmits to a larger group must pay fees to broadcasters.

Struggling with the Cloud

The justices struggled with the case because of concerns that a ruling against Aereo could hurt other kinds of Internet firms, notably cloud service providers which store content for later viewing.

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