Yesterday, I wrote about Aereo’s Supreme Court case against broadcast TV networks, the results of which will either affirm the start-up’s right to live or squash it out of existence. I did so by comparing Aereo’s TV-over-the-internet business model to an imaginary start-up called Readeo that sent robots to the newsstand to read issues of New York Magazine to you, thus avoiding paying the cover price. Several smart people quickly objected — noting that a magazine that charges for its content is very different from a network that provides its content for free over public airwaves.
Point taken: It was a dumb analogy. (Also: There are easier, non-robot-assisted ways to read our stories for free.) While I won’t defend my earlier effort, I take some small comfort in the observation that the world is awash in bad Aereo analogies, some written by people who are paid to think about copyright law all day.
Here, for example, is the analogy drawn by Cablevision — which opposes Aereo in this case, despite the fact that its own case provided much of the precedent upon which Aereo’s case relies — to describe how Aereo’s service constitutes a “public performance” of whatever’s on broadcast TV, and should be subject to the same copyright requirements as other public performers:
“If a brother calls his sister one Saturday morning and asks her to sing ‘Happy Birthday’ over the phone, the performance is clearly private. But if that same sister realizes she really enjoys singing ‘Happy Birthday’ over the phone and posts a sign in the grocery store that says, ‘Anyone who wishes to hear me sing Happy Birthday can call me this Saturday morning and I will sing it,’ the performance is public — even if her brother happens to be the only person who reads the sign and calls.”
That is not how Aereo works. Aereo is set up so that users can’t access the content from other users’ antennas, so there’s no invitation to join in an ongoing public performance of a TV show. And while Aereo users will inevitably end up viewing a show at the same time as other users, Aereo isn’t coordinating this simultaneity. Unlike the sister singing “Happy Birthday” over the phone, Aereo User A has no idea when Aereo User B is going to watch his copy of Law & Order: SVU, and no reason to care.
In fact, it’s probably pointless to come up with analogies for Aereo’s situation, because there’s really nothing else like broadcast television — which provides copyrighted content over government-issued public spectrum yet retains redistribution rights to that content, that is free in theory but in practice is propped up by billions of dollars in re-transmission fees paid by cable companies (costs that are then passed on to consumers, making it un-free), where the distribution rails for content are controlled by a labyrinthine series of regulations, many of which were written before the internet age and are in sore need of an update. The closest non-TV comparison would be to public radio, and even that isn’t very close.
Even the Supreme Court justices and the lawyers for each side are having trouble describing what Aereo does. Yesterday, Justice Breyer asked whether Aereo could be fairly compared to “a phonograph record store.” (No — Aereo doesn’t sell physical copies of copyrighted works, and also isn’t operating in 1906.) Paul Clement, the lawyer for the broadcasters, told the Court to think about the difference between a cable service and Aereo as being like “the difference between a car dealer and a valet parking service.” (No – Aereo is not a digital locker service, where users bring in a piece of copyrighted content they have licensed and remove the same piece of content at a later time.) And Justice Sotomayor made another phonograph analogy:
JUSTICE SOTOMAYOR: I always thought, and I’ll try to be careful about it, but not often enough, probably breach it like every other member of the public, that if I take a phonograph of a record and duplicate it a million times the way you’re doing it, and I then go out and sell each of those copies to the public, then I am violating the Act. So why is it that you are not?
Aereo’s answer – that the Sony Betamax case gave TV-watchers a fair-use right to reproduce an over-the-air broadcast for personal use, a right that was extended to remote DVR systems by the Cablevision case – was believable and well stated. As were many of the company’s other painstaking explanations for why it fits neatly into holes opened up by the legal precedent.
So why do I still think Aereo is a ridiculous company that deserves to be shut down? (Or more accurately, to be classified as a re-transmitter.)
Because it can’t admit to the Supreme Court what it is without blushing. Repeatedly yesterday, Aereo’s lawyer was asked by the Justices whether there were any legitimate technical reason to have thousands of tiny antennas rather than a few big antennas. The answer to that, of course, is no – thousands of tiny, one-person antennas are in fact a hugely inefficient way to deliver broadcast TV to large numbers of people, but they allow Aereo to exploit a loophole in copyright law and get around paying re-transmission fees. That’s the entire value proposition of the company – that it doesn’t have to pay the same royalties a re-transmitter would, and can thus offer broadcast TV over the internet for far cheaper than a cable company.
Aereo’s lawyer could have said that – “No, your honor, there’s no real reason for the tiny antennas other than satisfying the private-performance requirements established by Sony and Cablevision, but we think it’s a nifty trick, it’s legal, and it’s why we started our company.” That would have been a compelling argument, and one that – with the right evidentiary support – might have worked. Instead, the lawyer did contortions trying to come up with an alternate explanation for Aereo’s business model, which led to several convoluted exchanges like these:
JUSTICE SCALIA: That may well be, but it doesn’t contradict the Chief Justice’s question. I mean, you’re just saying that by doing it this way you don’t violate the copyright laws. But his question is, is there any reason you did it other than not to violate the copyright laws?
MR. FREDERICK: We understood yes, there is a reason, Justice Scalia. We wanted to tell consumers, you can replicate the experience at very small cost. You know you have a right to put an antenna on your roof and put a DVR in your living room. We can provide exactly the same antenna and DVR for a fraction of cost by putting it over the cloud.
I’d have been much more impressed if Aereo’s lawyer had owned up to the service’s real raison d’être. After all, it’s not illegal to concoct an elaborate mechanism to avoid paying a specific type of fee, if you’re abiding by the letter of the law. But it is suspicious to find a loophole, have your investors brag about your loophole in the media while ginning up interest in your product, and then return to the Court to profess that the loophole isn’t really what excites you – that informing consumers of their right to an antenna is.
This bad-faith argument – and the gullibility it presumes in the Justices, who, despite being technologically inept, have actually proven very capable on digital copyright cases – is part of why I’m not rooting for Aereo in court. I confess that it’s more of a tonal and rhetorical objection than a legal one. (And I’m not a copyright lawyer.) But judging from yesterday’s arguments, it looks like the people whose opinions really matter here – the nine people on the bench – are hung up on the same point.
As it is, the worst definition of Aereo might be the one provided by the company itself. The company’s stubborn refusal to admit that it’s predicated on a legal stunt is clearly annoying the justices. And it’s part of why I imagine the Court will issue a narrow ruling that shuts Aereo down but preserves other cloud services that weren’t started merely to take advantage of a legal technicality. If you want the law to recognize you, you first have to take off your mask.