Aereo Verdict: Supreme Court Says Streaming TV Service Is Illegal

In a 6-3 ruling, the U.S. Supreme Court has dealt a likely fatal blow to TV streaming service Aereo.

AereoThe majority of justices found that the internet startup — which streams TV broadcasts captured from over-the-air transmissions to subscribers — operates identically to a cable system. Aereo does not pay retransmission fees to broadcasters, whose content it streams, USA TODAY notes.

Aereo disputes the comparison to a cable system, noting that its subscribers get their own tiny antenna to capture broadcast programming.

Broadcasters, including Disney (DIS), Fox (FOX), Comcast’s (CMCSA) and CBS (CBS), sued Aereo claiming it was violating their rights by streaming their content to subscribers without paying retransmission fees. Aereo is backed by media magnate Barry Diller.

Three justicies — Antonin Scalia, Clarence Thomas and Samuel Alito — dissented from the majority, arguing that Aereo represented a loophole in current copyright law and that it was the role of Congress to deal with such issues, not the court.

In Wednesday morning trading, CBS jumped almost 4%, while CMCSA, DIS and FOX shares rose more than 1%.

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