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The Supreme Court Loves the Cloud. It's Not Sure About Aereo.

All of those arguments about Aereo's case and its impact on the future of cloud computing? It turns out the Supreme Court was listening.

All of those arguments about Aereo’s case and its impact on the future of cloud computing?

It turns out the Supreme Court was listening.

As attorneys for the Web TV service and the TV networks who are suing it argued their case today, justices repeatedly asked about ways they could write a judgement that protected the rights of other cloud computing services, such as Dropbox, to continue operating.

But they seemed less concerned about Aereo’s fate. Some justices wondered why Aereo shouldn’t be considered the equivalent of a cable company, which would give them the right to transmit TV programming — but would also require them to pay for it. And others argued that Aereo seemed primarily designed to evade copyright law.

Aereo allows subscribers to record and watch local TV broadcast stations. Subscribers can watch almost-live or recorded TV shows from Aereo’s remote storage center and stream it over the Internet to PCs, tablets and smartphones.

Unlike cable and satellite TV companies, Aereo doesn’t pay licensing fees for airing local TV shows. The company says that since it is only allowing consumers to remotely record, store and watch free over-the-air TV broadcasts, it doesn’t need to pay licensing fees to broadcasters. TV station owners disagree and argue that Aereo built a convoluted system designed to evade copyright laws. A lower federal court ruled in Aereo’s favor, which prompted broadcasters to appeal the decision to the Supreme Court.

Aereo says it is making it easier for consumers to watch private broadcasts of TV shows while broadcasters say the company is really offering public broadcasts of the same shows to thousands of people. Legally, it’s an important distinction because copyright law protects private broadcasts but not public ones.

Looking at a description of Aereo’s business it’s hard to see how they aren’t a cable company, said Justice Sonia Sotomayor. “I read it and say, why aren’t they a cable company?” she said.

Both Sotomayor and Justice Stephen Breyer also expressed concerns about how a decision in this case could disrupt other cloud computing companies such as Dropbox or Amazon.

Aereo stores recorded TV shows on cloud-based servers, and several tech companies have raised concerns that the court’s ultimate decision could make it harder for them to do business as usual.

“How do we get out of this,” and write a decision that allows cloud-computing companies to keep operating, Breyer asked Eric Feigin, a lawyer with the Department of Justice, which has sided with the TV networks in this case.

Aereo attorney David Frederick repeatedly characterized the company’s service as a hardware company that merely rented antennas and DVRs to its customers. But justices continued to ask him why his service was different from conventional and Web TV providers that pay for their content.

“From the user’s perspective, it’s exactly the same as what’s available on cable”, said Justice Elena Kagan.

And Chief Justice John Roberts asked Frederick several questions about Aereo’s technical construction, wondering why the service provided individual antennas and individual copies of TV shows for its users. Answering his own question at one point, he argued that the service seemed designed to take advantage of a legal loophole.

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