updated 10:04 am EDT, Sat June 28, 2014
Users to be refunded last month of service, future of company in danger
In the fallout of the anti-Aereo Supreme Court decision, founder and CEO Chet Kanojia has emailed customers, declaring that while consulting with the courts, the television streaming service must shut down. Users will only be able to access the cloud-based antenna and DVR until 11:30 EST today.
Kanojia writes that as a result of the Supreme Court decision "we have decided to pause our operations temporarily as we consult with the court and map out our next steps. You will be able to access your cloud-based antenna and DVR only until 11:30AM ET today. All of our users will be refunded their last paid month." Users are directed to contact support if they have questions about billing or the account.
Aereo provided thousands of micro antennas for recording individual programs unique to their subscribers, rather than using a single antenna and repeating content to every subscriber. However, the company did record a program once, and replayed that recording to multiple users. In the court's opinion, Aereo operated as if it was a cable company, and should be subject to the same requirement to obtain licenses for retransmission of content.
Justices Breyer, Ginsburg, Kagan, Kennedy, Roberts, and Sotomayor voted in favor of the decision, with Justices Alito, Scalia, and Thomas dissenting. Aereo could opt to negotiate licenses for rebroadcast, but this would dramatically increase pricing to customers. The future of Aereo, and potentially the entire cloud storage industry, has been jeopardized by the court's ruling, despite the ruling claiming that "given the limited nature of this holding, the Court does not believe its decision will discourage the emergence or use of different kinds of technologies."
The justices seemed to lack an inherent understanding of the technology during the April hearing. Supreme Court Justice Sonia Sotomayor wondered what Roku was paying for a licensing fee to cable companies and big media for the content it streams. Additionally, Justice Antonin Scalia wasn't aware that HBO is a cable-only entity, and not receivable over the air. Lawyers and justices spent time during the hearing invoking allegories involving valet parking services viewed from 30,000 feet and coat check rooms as a parallel to Aereo's service.
"The spectrum that the broadcasters use to transmit over the air programming belongs to the American public and we believe you should have a right to access that live programming whether your antenna sits on the roof of your home, on top of your television or in the cloud," declared Kanojia.