Deborah D. McAdams /
04.24.2014 10:40 AM
McAdams On Aereo: Wordplay v. Science
TRANSPARENCY—The Aereo controversy is about many things. It’s about the use of language to manipulate public opinion. It’s about how the explosion of IP technology has left media law in the dust. It’s about the deterioration of ownership boundaries and the maturing public perception that all media content should be free in perpetuity.

What it is not about is technological innovation.

“Innovation” is the persecutory term of choice in Washington, D.C. Its usage seeped out of the Silicon Valley argot that condescends to anyone who doesn’t code, and makes billionaires of those who do, regardless of whose privacy and rights are violated. Opposing something that this anarchic core elite has deemed an “innovation” is like admitting ill will toward puppies.

“Innovation” is the key word employed in Aereo’s PR strategy. Aereo chief Chet Kanojia has used it like a hammer, along with the meme of consumer benevolence, since Aereo was announced.

“Innovations in technology over time, from digital signals to digital video recorders, have made access to television easier and better for consumers,” he said March 1, 2012, in response to the initial lawsuits filed by broadcasters that led to a review by the U.S. Supreme Court on April 22.

“The Aereo technology is functionally equivalent to a home antenna and DVR, but it is an innovation that provides convenience and ease to the consumer,” Kanojia said last December. Even the sentence structure here is contradictory. Aereo is something, but it is something else.

“The broadcasters’ positions in this case, if sustained, would impair cloud innovation,” he said in a more recent statement reflecting Aereo’s latest legal strategy of trying to frighten the judiciary into believing that if it takes down Aereo, it takes down the cloud.

So successful has Kanojia’s wordplay campaign been that his patois is parroted by the consumer press without question. E.g.:

“I had the privilege of spending a couple partial days with Kanojia, and meet some of the other people behind this innovative company,” Christine Lagorio-Chafkin wrote recently for Inc.

Aereo’s strategy of casting itself as a bootstrap upstart simply trying to friend consumers obscures the fact that it is backed by an e-commerce billionaire whose only interest in consumers is their routing numbers. It overlooks the reality that Aereo has been funded to the tune of $100 million and launched with every intention of getting sued by broadcasters, whose signals the service resells without permission.

Perhaps most effectively, it deflects attention away from Aereo’s use of junk science to circumvent copyright law.

This last point is pivotal. Aereo claims to have done something no other radio frequency engineer has ever achieved—to be able to pick up TV signals independently with dime-sized antennas stuffed into one large array. The first provisional patent application for this was filed in November of 2010, just 16 months before the service was launched.

That means that Mr. Kanojia and Joseph Thaddeus Lipowski achieved in less than two years what the combined minds of RCA Labs, Zenith and LG have never been able to do—create a TV antenna that is a tiny fraction of the size of the radio frequency wave it’s designed to receive, which does so discretely even while packed together with hundreds of others.

This presumed technological breakthrough is the foundation of Aereo’s legal defense. The legal precedent being employed here is the 2008 Cablevision case in which the cable operator’s remote DVR service was defined as one providing a “private performance,” and therefore not subject to copyright law.

Aereo claims to do the same thing by renting each of the tiny antennas to a specific user, who can then either watch live TV or access their own, digital copy of a program from cloud storage.

One inconsistency with Aereo’s use of the Cablevision precedent is that Cablevision pays retransmission and carriage fees for the initial signals. Aereo notably does not, and never so much as offered to negotiate for them. The other inconsistency is that the one-antenna-per-user model necessary for Aereo’s Cablevision defense defies physics according to every radio frequency engineer with whom I’ve spoken.

(Pete Putman provides an excellent illustration with “Deconstructing Aereo’s Patent.”) What Pete and his peers say is that Aereo’s arrays would have to act as one, large antenna that receives distinct TV signals and disseminates them to many people for a fee. This would make Aereo a multichannel video program distributor subject to copyright law, and by extension, retransmission consent:

“A multichannel video program distributor is an entity such as, but not limited to, a cable operator, a BRS/EBS provider, a direct broadcast satellite service, a television receive-only satellite program distributor, or a satellite master antenna television system operator, that makes available for purchase, by subscribers or customers, multiple channels of video programming.”

This one-to-many configuration comprises a “public performance,” and is therefore subject to Copyright Law. The point of whether or not Aereo is a cable system was brought up several times by the justices, who also pressed Aereo’s attorney David Frederick on the antenna design.

“There’s no technological reason for you to have 10,000 dime-sized antennae, other than to get around copyright law,” Chief Justice John Roberts said to Frederick.

Aereo has in fact slowly backed off of its initial insistence that each tiny antenna is assigned to an individual user. Now it’s just “some.”

“Some are statistically assigned to particular users,” Frederick said during the proceedings.

So then, some—not all, but some—users are each assigned a specific antenna, for an unspecified period of time, while others may use several over the course of a session or at any time, implying that the signals are being received over the entire field of the array, like a single antenna.

This means that Aereo could be found in violation of the Copyright Act simply because it fits the definition of a cable system, leaving the public-private performance question and the cloud out of it. And likely it would have been already in the lower courts had the plaintiff’s expert witness not phoned in his testimony.

The public perception that Aereo represents technological innovation that broadcasters are trying to quash out of greed is nothing but a successful public relations campaign, pure and simple. Otherwise, Aereo’s architects would have gladly demonstrated the technology to experienced RF engineers rather than blocking questions about the patent applications in lower court depositions. Applications that U.S. Magistrate Judge Henry Pitman referred to as consisting of Kanojia and Lipowski’s “own sworn statements.”

“Pitman also dismissed what he called the ‘rather odd argument’ that forcing the executives to testify about the patents in this copyright dispute ‘could later potentially be used in an entirely different context’ against them,” Courthouse News Service reported.  
Unfortunately, the discovery obtained in that deposition is sealed.


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Posted by: Ed Fraticelli
Fri, 04-25-2014 11:17 AM Report Comment
I am still not understanding broadcaster's objection to Aereo, at least in its most basic form. It provides access to a television stations signal to people who may not be able to receive it, otherwise. We all know that consumers can purchase antennas and receive the local DTV signals for free, which is basic Television service. But, many people live in areas where signals are marginal and we all know that DTV is "all or nothing" with the cliff-effect and all. Paying Aereo a couple of dollars per month to eliminate the need for the complicated, unsightly antenna that may not even work, would be well worth it. Kind of like cable WAS before they stuffed-in all the other options which are not optional. So, why would broadcasters object to this? I assume it is because the days of broadcast TV making most or all of their revenues on ad sales is long gone and now they primarily rely on retransmission fees from MVPD's like cable companies. Am I missing something here?
Posted by: john luff
Fri, 04-25-2014 12:42 PM Report Comment
Well put as usual Deborah. There are significant differences between what Aereo is doiing and what consumers could in theory do for themselves. First, extending the delivery over the internet is not in itself against the law. SlingBox has been doing it for years, from one consumer's transmission equipment (Slingbox) to their own individual reception equipment (Slingbox player). If an individual consumer wanted to do that they can without Aereo, AND without the monthly fee they charge for access to the content. Buy a box, connect it to your digital pipe, and you're in business, from a mobile or fixed player. A friend who lives in China uses a SlingBox in Ohio to watch NFL games live from his father's TV. No harm, no foul. But if he took that signal and delivered it commercially to others he should be paying for the use of the content. Aereo claims that should be without fee for doing precisely that. Seems pretty close of theft of content to me. If I rented my HBO feed to a bar, even if it was where I wanted to sit, they would sue me, naturally. On technological grounds their claim to rent individual antennas is immaterial. They can't rent the entire chain to an individual user in any event. Bit stream receivers and retransmission encapsulated as IP are not free, AND it is hard to accept that they have tens of thousands of receivers and encapsulators in their secret facilities even if the specious claims about dime sized antennas, which violate the laws of physics, were true. Ed (and 'anonymous"), you're wrong on the economics of local (or network) television. Retransmission fees are the icing on the cake that keeps a decent profit margin, but if stations had to live on that alone broadcasting would die quickly and suddenly. Claims that they are dinosaurs just before the asteroid hits are not credible. In the regulatory environment we live broadcasters are at the mercy of the FCC for the rules of the road, which the FCC changes almost daily it seems. I can only interpret those burdens as an effort by the FCC to pick winners and losers in the commercial marketplace by some logic related to the 'highest and best use' of the spectrum. Whose evaluation of that are we willing to rely upon? The CE industry who wants to sell more boxes even if it means we kill the over the air boxes they sold to us last year?? There is also the claim that a loss by Aereo would kill cloud storage, and other 'digital innovation'. I can't see a parallel between Aereo (a commercial enterprise with lots of investor money betting on them) storing copyrighted content someone else produced and paid for on it's servers and anyone using cloud storage for private use. Storing your own files (which you create) on DropBox is not the same as copying someone's content and renting the use after storing it on private premises. I can't see how any of the Justices would miss the inference. There is much at stake in the SCOTUS review of Aereo. If Aereo had gone to the stations and agreed to a modest fee for the content no one would have complained. Frankly I wonder why the stations don't simply put their signal on a pay per month basis on the internet (at say $2/month) undercutting what Aereo could economically do. Maybe their affiliation agreements don't allow it...
Posted by: Anonymous
Fri, 04-25-2014 10:07 AM Report Comment
As much as Aereo has tried to steer this more to the public vs. private performance issue, I don't think the Supreme Court is having anything of it. They were obviously focused on the antenna's and their sole purpose of circumventing the law. I think the bigger issue is framing their decision so that it is relevant to future cases when a true innovation comes along or when it is deemed that the old laws need to be changed to accommodate new technologies and the new ways that media are being consumed. Great stuff Deborah!
Posted by: Anonymous
Fri, 04-25-2014 11:23 AM Report Comment
McAdams is brilliant! Again!
Posted by: Anonymous
Fri, 04-25-2014 12:16 PM Report Comment
Ed has it right. Broadcasters were given this retransmission fee plum because of their lobbying efforts and in the present times it is obsolete but a big revenue producer.
Posted by: Anonymous
Fri, 04-25-2014 01:42 PM Report Comment
Ed has it wrong. Aereo isn't replacing unreliable OTA for rural users. They're in New York and other major cities, poaching business from the paying cable and satellite services. **** Anonymous also has it wrong. The supreme court doesn't want to make a decision that will be relevant to future cases. It's clear from justice Breyer's questions that the goal is to avoid doing anything that will have unintended consequences on future technologies, such as cloud services. The less relevant the better for them. That's why the Putman article is just what the court would love to have before them. It would let them rule on the bogus tiny antenna/individual path issue, and not risk anything else.
Posted by: Anonymous
Fri, 04-25-2014 06:04 PM Report Comment
Dona, So well put. If you're arguing about technical details, you should let the engineering testimony be front and center. The antenna argument is such a piece of swiss cheese. Anyone with even the most basic knowledge of how antennas work can see right through it. Luckily, some of the jurists who have already ruled as well as those who are now examining it again seems to have a good notion of this. Lets get some neutral yet prominent engineer to stand up and say that the emporer is not wearing any clothes, then see what happens next. Tom Z, WB2ZDF
Posted by: Anonymous
Fri, 04-25-2014 06:06 PM Report Comment
Let's fix this, people. As I see it, Aereo is an elegant way to deliver mobile local DTV - which is the travesty the whole ATSC/8VSB/Dyle fiasco has created. Who in their right mind is going to hang a dongle and whip antenna off their iPhone to watch TV? WiFi is here, it's widely available, and stations want people to watch their programs. Make a deal between the NAB and Aereo and deploy this technology nationwide NOW! Viewers aren't patient, and if they can't get the local news on their phones they can - and do - watch Netflix on them today. Let that happen over and over and you'll lose them forever - especially younger viewers.
Posted by: Anonymous
Mon, 04-28-2014 12:28 PM Report Comment
I have no Idea how Aereos technology does or doesnot work. The basis upon which the court are supporting there position is law from approx. 100 years ago. There are so many historical instances of law having to be amended in order to reflect the current state of implementation methodologies. IN other words you cannot continue to pay disability insurance if the patient recieves a fully functioning prostheses. The real question is about intellectual proporty rights and who is really the owner at what point in time. The TIME factor is extremly important as we all agree that our labor has some value. (If I build a garden and invest myself in that garden and people come and leave the garden, not less, perhaps better, from my point of view. That is my "mehrwert" in a twisted sense the value I value myself. THE HANDFUL OF STONES.

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