This is a stunner. A U.S. District Court judge ruled today that the major broadcast networks may have to license their programming to Alki David’s video streaming service FilmOn X. That flies in the face of previous rulings that allowed them to keep their popular shows off of FilmOn and other services including now-defunct Aereo.
At issue is an interpretation of the federal Copyright Act’s standards for a compulsory license. The Act has been interpreted to give cable and satellite companies the right to offer broadcasters’ fare for a negotiated fee — or, if a deal can’t be reached, with one set by the U.S. Copyright Office.
FilmOn says it’s similar to a cable company, and wants a compulsory license. Broadcasters including ABC, CBS, Fox, and NBCUniversal said the Internet service is fundamentally different.
Judge George Wu sided with FilmOn, saying that “no matter how strong the policy arguments for treating traditional cable services and [FilmOn’s] service differently” the law “simply does not draw the distinction Plaintiffs urge.”
But he added that due to “the relative importance of the issues decided here,” the companies should “preserve the status quo” while broadcasters appeal.
Fox says it will do just that. The opinion, it says, “contravenes all legal precedent. The court only found that FilmOn could potentially qualify for a compulsory license, and we do not believe that is a possibility. The injunction barring Film On from retransmitting broadcast programming over the internet still remains in place and the full burden of proof still lies with FilmOn. We will of course appeal and fully expect to prevail.”
The appeal will go to the Ninth Circuit. Similar cases will be reviewed in U.S. courts in Washington, DC and New York.
The FCC also plans to weigh in on the question of whether streaming services should have the same rights as cable and satellite companies. It’s expected to say that they do — but that they also are governed by rules that entitle broadcasters to negotiate retransmission consent deals.