Aereo's Supreme Court Defeat: The Winners and Losers

What's This?

David Frederick, outside counsel with Aereo Inc., center, speaks to the media with Chet Kanojia, CEO of Aereo Inc., left, and Brenda Cotter, general counsel with Aereo Inc., right, following oral arguments at the U.S. Supreme Court in Washington, D.C., U.S., on April 22, 2014.

Image: Andrew Harrer/Bloomberg/Getty Images

By Jason Abbruzzese2014-06-25 17:58:02 UTC

The Supreme Court ruled against Aereo in a case with major ramifications for the media and technology industries. Broadcasters, Internet giants, cloud computing startups and even the U.S. government chose sides on this case. Now, the battle is over and the field is littered with losers and winners. Here's a look at the new landscape:

Losers

Aereo

Chet Kanojia, chief executive officer of Aereo Inc., leaves the U.S. Supreme Court following oral arguments by Aereo Inc. and American Broadcasting Companies Inc. in Washington, D.C., U.S., on April 22, 2014. U.S.

Image: Andrew Harrer/Bloomberg/Getty Images

Losing at the Supreme Court usually puts a company in the loser column, but Aereo is in a worse bind than most. Its main financial backer, Barry Diller, went on CNBC soon after the ruling as said "it's over." Some analysts believe the company could attempt to be labeled a cable operator and gain a compulsory license to retransmit copyrighted works, but Aereo has given no indication it will pursue that idea.

Cord cutters

Image: Flickr, Wonderlane

Whether you consider Aereo legal or not, its customers will certainly miss it. The company provided cord cutters with a way to access local broadcast TV without paying for a complete cable package. Aereo's customers will now need to look into buying their own antenna. Here's one for $8.99, a dollar more than a monthly Aereo subscription.

Aereo competitors/TV startups

Sling Media CEO, Chairman and co-founder Blake Krikorian holds up the Slingbox PRO-HD, left, and the SlingCatcher at the Consumer Electronics Show (CES) in Las Vegas, Tuesday, Jan. 8, 2008.

Image: Paul Sakuma/Associated Press

Companies like Slingbox, NimbleTV, which is an Aereo-like service for cable subscribers, and Simple.TV, which makes a streaming DVR for connected devices, could be at risk. The Aereo ruling could be used as a major precedent if broadcasters take aim at these companies.

Winners

Broadcasters

Videojournalists set up outside of the Supreme Court in Washington, Tuesday, April 22, 2104. The court heard arguments between Aereo, Inc., an internet startup company that gives subscribers access to broadcast television on their laptops and other portable devices and the broadcasters.

Image: J. David Ake/Associated Press

The ruling extends the copyrights of broadcast television and ensures firm control over content being streamed. The defeat of Aereo helps ensure that lucrative fees it charges to cable television companies will continue to flow.

Politicians

The U.S. Capitol building is seen Saturday, Nov., 19, 2011, in Washington.

Aereo had been a threat to local television stations, which are funded by the fees from cable companies. Local TV provides politicians with an important avenue to reach constituents cheaply and effectively.

Unclear

Cloud storage: There's good news and bad news for cloud computing in the Aereo ruling.

The bad news first: the finding by the court says that by streaming television to consumers Aereo is engaging in a performance, which in the legal world implies that it is engaged in showing content as part of its business. That could mean that any cloud computing company that sends content to a customer is engaged in a performance and falls under a wider range of laws including the Copyright Act.

The good news: Justice Breyer addressed some of these issues in his majority opinion. He referenced that cloud storage is different because it provides a service in which people can access content they have lawfully acquired and also invoked "fair use," in which copyrighted material can be used in a limited capacity without gaining the rights of the content.

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Topics: Aereo, Business, Media, Startups, streaming television, Television