The Aereo: Mashing Up Television

Where is the proverbial dividing line between legal (and laudable) creativity and illegal copyright infringement? And who pays the price when someone crosses that line?

Former Beatle George Harrison undoubtedly stepped over it when he lifted the title melody from the Chiffons’ Motown classic He’s So Fine and applied it to his song My Sweet Lord. Although he never admitted that he consciously did so, the legal case eventually became a landmark application of copyright law.

Harrison subsequently told the press that the inspirational song had saved the lives of many heroin addicts. Fortunately, the song was not banned from the air waves; Harrison and the Chiffons simply agreed on a hefty financial penalty, and My Sweet Lord has become a timeless classic.

The practice of expropriating lyrics or melodies from previously copyrighted material has since blossomed into a song writing technique called the mashup.  Technologists have been known to utilize the technique as well, and just last week, one particular mashup threatened to upend the entire television industry.

Introducing the Aereo

How do we access our television programs? Nowadays, most of us watch shows that are transmitted through underground cables and then displayed on private channels. However, some of us still purchase television sets with old-fashioned antennae that display signals that are transmitted over the public air waves.

The vast majority of all television programming is not available over the public air waves. In fact, only ABC, CBS, FOX, NBC, and PBS transmit their shows in this manner, along with a small number of independent stations. These five networks also contract with cable television services that rebroadcast their shows over their private systems, while simultaneously distributing their shows over the public air waves for free.

Nevertheless, the cable television services cannot simply grab these free public signals and transmit them without paying royalty fees to the five networks; they would be infringing on the legal copyrights of the networks by doing so. The services and the networks have thus established royalty contracts that authorize such transmissions.

The Aereo, however, is seeking to avoid making royalty payments by designing its business model as a mashup of old and new technologies. It is positioning itself as a landlord that is renting each of its customers a tiny traditional television antenna, which captures signals from public air waves and retransmits them via the internet. In its role as a landlord, it asserts, it possesses the right to retransmit free public television signals.

Back To The Future

At first blush, you might indeed glance dubiously at the Aereo’s legal strategy. After all, didn’t web transmission services from Napster to MegaUpload fail to persuade the courts that they were simply serving as electronic conduits for their users?

Yes, but these organizations never crafted business models that were based on mashups of old and new technologies. By doing so, the Aereo is hoping to craft a legally valid strategy that permits it to retransmit television signals from the public airwaves without signing royalty contracts with the five broadcast networks.

There are indeed legal precedents that support the Aereo’s business model. Consider the owner of an apartment complex in New York City, for instance, who places a traditional television antenna on the roof for each tenant and then runs a cable down the side of the building to carry the signals to each tenant’s unit. If the service is provided in accordance with the tenant’s lease agreement, how does it differ from the Aereo’s antennae rental arrangements?

According to the firm, the only difference is that the landlord uses traditional cables to carry the signals from the antennae to the viewing screens, while the Aereo uses internet technologies to carry the transmissions. In other words, the firm is asserting that the technological mash-up itself is the only significant differentiating feature of their contractual arrangements.

Waiting For Justice

Eventually, we’ll know whether the legal system will approve of the Aereo’s business model when the relevant cases work their way through the courts. And there is no guarantee that judges and juries will favor the Aereo; it’s quite possible that a single negative decision may doom the firm to the same fate that has befallen Ivi TV and other similar services.

Regardless of the Aereo’s fate, however, we can be assured that engineers will not stop trying to develop new products and services by mashing up older and newer technologies. After all, even though fans of George Harrison were still able to listen to his music after he lost his copyright infringement case, many viewers of traditional television networks will be denied access to their shows if the Aereo loses its legal battle.

They would thus represent a customer segment in search of a service, providing a ripe target for entrepreneurs. Even if the Aereo fails to design a business model that can reach them, other technology firms will surely focus on doing so.

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