A U.S. District judge ruled today that Internet TV service ivi was breaking the law by offering live streams of network and cable television. The company, which offers online broadcasts of 55 stations in the Los Angeles, Chicago and New York area for under $5 a month, was ordered to cease operations immediately as a result of a preliminary injunction issued by Judge Naomi Buchwald. The federal judges ruling said:
Congress legislated with an understanding that the cable systems it was granting a compulsory license to would also be subject to the regulations of the FCC…. [N]o company or technology which refuses to abide by the rules of the FCC has ever been deemed a cable system for purposes of the Copyright Act. Significantly, companies such as AT&T U-Verse, which claim to operate outside of the jurisdiction of the Communications Act, still comply with these rules, most significantly by obtaining retransmission consent.
Ivi posted a statement on their website saying that they believed Buchwald’s decision was incorrect and they would suspend billing for ivi Air and ivi Pro customers so subscribers didn’t have to close their accounts. Ivi said their service is completely legal because of an license that Congress had created for the cable industry. The copyright law allows cable operators to use broadcast signals if they pay royalties, but also allows broadcasters the right to ask for more revenue in accordance with FCC regulations. Ivi claims it has the best of both worlds and is both a cable system and an Internet service: In essence, they are allowed to stream content but aren’t forced to follow FCC rules. Right now, the company pays about $100 a year in royalties and does not have the approval from broadcast networks unlike AT&T’s IPTV service U-Verse services.
Ivi TV Chief Executive Todd Weaver responded the the decision with a statement that denounced the decision, saying that the judge was overstepping her constitutional power.
Judge Buchwald’s opinion is premised on her statement that ivi is ‘not complying with the rules and regulations of the FCC’. This conclusion is simply false, as ivi has met with the all the commisioner’s offices of the FCC repeatedly and has received assurances that we are in full and complete compliance. Judge Buchwald makes the legal mistake of misinterpreting the copyright law to instead make communications policy. Communications policy is the province of the FCC and, by basing a judicial copyright decision on communications regulations to be administered by the FCC, the judge is overstepping her constitutional authority.
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