Supreme Court Case on Aereo Spells Potential Changes for Cloud Industry

The U.S. Supreme Court is currently considering the legality of an internet service called Aereo, which allows its users to stream and record live television. Oral arguments have begun and so far, the future does not seem to bode well for Aereo as the justices ask telling questions about the technology’s scope.

The IT industry has been paying close attention to the case, as it could have potential impact on cloud technology as a whole — and broadcast television too. Aereo rebroadcasts TV shows to its transcribers without paying the appropriate retransmission fees. “There’s a reason people call them copies,” Chief Justice John Roberts has said, seeming to critique the fact that Aereo is simply re-serving copyrighted television shows to customers.

On the other hand, several justices, including Justice Stephen Breyer, have been concerned about the potential implication a decision against Aereo could have for cloud. He has compared Aereo’s technology to similar services offered by companies that store songs in the cloud, delivering them on demand. “The cloud-computing industry is freaking out about this case,” says David Frederick, the attorney for Aereo.

According to Frederick, Aereo is not attempting to be a cable service — they’re merely providing customers the ability to store cable shows for watching later. The Obama administration has already sided with broadcasters, saying that “the system is clearly infringing” considering that similar services like Hulu and Netflix pay out to copyright holders.

In the end, it might come down to the issue that Justice Ginsburg has noted: “Every other transmitter does pay a royalty — maybe it’s under compulsory license — and you are the only player so far that doesn’t pay any royalties at any stage.” Legalizing Aereo’s actions could potentially leave many companies off the hook for paying copyright royalties.

Along with the Aereo case, cloud technology providers have certainly had enough to worry about over the past few months. Recently, huge data breaches like Heartbleed and the zero-day vulnerability in Internet Explorer have made consumers wary about storing information online on cloud. Research shows that data breaches are expensive, but easily preventable with the proper security frameworks in place.

The Court is expected to reach a verdict by June.

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