The Future of Sports Broadcasting?

The 1976 Copyright Act has long protected a copyright holder’s exclusive rights in their Copyright. Those rights include public performance rights (amongst others). These rights remain with the work, even if the work is sold. The public performance right prevents people from performing a copyrighted work in a place that is open to the public or where a substantial number of persons outside one’s family and friends are gathered. Additionally, the Copyright Act prevents transmissions of performances to the public at large, even if they originate from a private location. The leading cases come from the Third Circuit in the 1980’s Columbia Pictures v. Redd Horne and Columbia Pictures v. Aveco. In both of those cases the Third Circuit held private viewing rooms in movie rental stores to be public in nature, even though the stores attempted to carve out a place of privacy within this public location. Despite the “nature” rhetoric of Redd Horne, the case ultimately turned on the fact that employees were transmitting these Copyrighted works into these movie rooms.

In 2013, technology has far exceeded the imagination of the 1976 drafters of the Copyright Act. Technology has made transmissions and reproductions of Copyrighted materials even easier. DVR, music sharing, satellites, and cloud storage have all added to the convenience of the subscriber. Sport event copyrights have been insulated, for most part, by being virtually “DVR” proof because the viewer enjoys watching them in real time. However, a home-style exception in the Copyright Act protects bars, restaurants, and other public places from falling under the “open to the public” prong of the “public performance” definition if the technology emulates that of a home. Moreover, transmission technology is constantly improving. Broadcasters have begun to focus on these transmission issues that enable individual users to access channels via state of the art technology, in real time. Usually a company, such as DirecTV, pay a “retransmission fee” to transmit a sporting event (copyrighted by the broadcaster) to an individual.

Recently, a start-up company in New York called “Aereo” was brought under fire for using tons of tiny antennas in the Brooklyn area to pick up signals. For $8 a month, an individual could “control” one of these antennas and select programming over the internet to stream to their phones or tablets. Essentially, Aereo has allowed one to turn their phone into a “mini-tv,” and no longer is that evening wedding reception, or dinner party, going to cause you to miss the big game, and better yet, it’s affordable. In a 2-1 decision, a federal appeals court in New York upheld the technology and said it did not violate the public performance right of the Copyright Act. With the court’s upholding of this technology, Windows, Mac, iOS, and other software providers have supported Aero’s Internet streaming. However, Aerokiller, a company similar to Aereo, was found to be in violation of the Copyright owner’s public performance right in California, but it only applies within Los Angeles. The case is currently being appealed. This creates a serious question about US owned airways and the public’s right to access them, thus this issue may end up in front of the Supreme Court.

Regardless, this trend is having a major affect on broadcast companies. Fox News has threatened to go off the air and make its shows available by subscription only. Chief Operating Officer, Chase Carey expressed his dissatisfaction with New York’s ruling on stating, “We need to be able to be fairly compensated for our content. This is not an ideal path we look to pursue, but we can’t sit idly by and let an entity steal our signal. We will move to a subscription model if that’s our only recourse.” Fox is a longtime partner of the NCAA and NFL, and turning Fox to “subscription only” would greatly change the face of the sports industry. Additionally, ABC, CBS, and NBC, also longtime sports broadcasters, could follow suit. At the college level alone, television broadcasts dictate game-times and conference re-alliances, thus the scope of this decision is vast. (Read the entire Bloomberg article about the affect of Aereo technology here.)