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Thursday, April 25, 2013

If Aereo (streaming TV) succeeds, will Pandora (streaming music) benefit?

Aereo, the company which snags over-the-air TV and streams it to people over the Internet without paying retransmission fees to broadcasters, is coming to New Hampshire (as I reported two days ago).

The company is still involved in legal fights, since the broadcasters claim it is illegall retransmitting their signals, but so far it has won.

Which leads to a question: Why does streaming-music service Pandora have to pay licensing fees to stream music if Aereo doesn't have to pay to stream shows? That question is pondered in this essay (spotted via good old Slashdot) which gives a good overview of how Aereo's weird system - it uses tons of tiny antennas, each of which serves one customer - convinced judges it was OK.

The Court looked at Aereo’s novel technology to assess whether the performance (the transmission of the programming from an over-the-air television station over the Internet) was in fact a “public” performance. To be considered a public performance, a performance has to be to the “public” – more than simply to a single individual or to a close circle of friends and family. If you “transmit” a program within your own home, e.g. you make a DVR copy in one room that you or someone else in your family watches in another room, you may have a performance, but it probably isn’t a public one. By contrast, if you take a whole bunch of TV signals and send them all at once to a bunch of paying customers, like a cable system or even a SMATV system, you are making a public performance. Where does Aereo fall in this continuum? That was the decision before the Court.

...

The impact of the decision, were it to be adopted nationwide, could lead to a significant reexamination of the concept of a public performance. You could see cable systems changing their receive-antennas for over-the-air stations to adopt an Aereo model to try to cut down on retransmission consent fees to TV stations – or radio antennas set up to stream signals on demand to single users to avoid the public performance obligation for music royalties.