Broadcast networks, which previously failed to persuade a panel of federal appeals judges to shut down the Barry Diller-backed online TV service Aereo, have lost a bid to have the case reheard by the full appellate court.
The U.S. Court of Appeals in New York found in a 2-1 ruling in April that Aereo doesn't violate the networks' copyrights for programs because its transmissions to subscribers aren't public performances, which would require a license. In a filing today, the appeals court said it won't review the case.
"An active judge of the court requested a poll on whether to rehear the case," the appeals court said in its order. "A poll having been conducted and there being no majority favoring in banc review, rehearing in banc is hereby denied."
Broadcasters including Walt Disney Co.'s ABC, Comcast's NBC and CBS Corp. had asked the Second Circuit appeals court to overturn a July 2012 order by U.S. District Judge Alison Nathan denying a preliminary injunction that would have shut Aereo down.
Aereo is just one of the fledgling or planned services looking to improve or upend traditional TV, but it may be one of the most disruptive. Intel's forthcoming TV service, for example, envisions paying networks to carry their content, just like existing cable and satellite companies do. Aereo pulls broadcasters' signals out of the air using an antenna for each subscriber, then streams the programming to computers and mobile devices -- without compensation to the networks.
Broadcasters fear that Aereo will undermine existing cable and satellite companies by undercutting them on pricing. "Watch TV online," the company's site says. "Save shows for later. No cable required."
"The 2nd circuit's denial of our request for an 'en banc' hearing, while disappointing was not unexpected," Fox said in a statement after the ruling. "We will now review our options and determine the appropriate course of action, which include seeking a hearing in the U.S. Supreme Court and proceeding to a full trial on the merits of the case."
~ Bloomberg News and Ad Age staff ~