NFL 'dodged a bullet' with Aereo decision


The NFL and other pro sports leagues are breathing a sigh of relief, say experts, after Wednesday's Supreme Court ruling against TV streaming service Aereo.

Football fans watch the NFL Super Bowl XLVIII game between the Denver Broncos and the Seattle Seahawks on at a sports bar in New Jersey on February 2, 2014.
Cem Ozdel | Anadolu Agency | Getty Images

"It's a big victory for the NFL and allows them to keep the value of their content," said Mark Conrad, a professor of sports law at Fordham University.

"They (NFL) didn't want the networks pulling out of huge broadcast deals if Aereo won," explained Conrad. "They wanted the status quo, and that's what they got. They dodged a bullet."

Read MoreAereo CEO: We're disappointed in the outcome, but our work is not done

Aereo is a start-up streaming service that allows subscribers to watch and record their local, over-the-air broadcast channels via a tiny remote antenna and cloud-based DVR. The U.S. Supreme Court ruled that Aereo violates copyright law.

What the decision might do, said Miro Copic, professor of marketing at San Diego State University, is force the pro leagues to form a better plan to deal with so-called "disruptive" companies like Aereo in the future.

"It buys them time to figure out how to maximize the value of their content across any media," said Copic.

Aereo responds to court loss

Aereo has been charging around $8 to $12 a month—a fraction of the cost of a typical monthly cable subscription. The service is available in about 11 cities, including New York, Miami, Boston, Atlanta and Houston.

But Aereo had not been paying retransmission fees to broadcasters.

What bothered pro sports, along with TV broadcasting networks such ABC, NBC and Fox, was the perceived loss of the billions of dollars paid to TV networks for broadcasting rights.

Read MoreWhat Aereo ruling means for TV watchers

If Aereo had won, the thought was that it would help fans bypass the broadcasters and devalue those expensive contracts with the NFL.

In a friend-of-the court brief, both the NFL and Major League Baseball said that Aereo's business is "neither technologically efficient nor innovative. It has no purpose other than to avoid compensating the copyright owners whose programming Aereo exploits."

The two leagues stated in the brief that they collect about $100 million of the $300 million broadcasters receive from "compulsory" license fees paid by cable and satellite outlets.

Aereo had argued that it charges for technology and not TV content, and was not breaking any copyright laws. It said cloud services use the Internet in the same way it does to store and transfer copyrighted content.

But the 6-3 decision by the court said Aereo must pay broadcasters when it takes programs from the airwaves and transfers them to subscribers who watch on phones and other devices.

An email reply from the NFL said the league had no comment on the decision. An email request for comment from MLB was not returned at the time this story was published.

Worry about 'next Aereo'

Fordham's Conrad said he's not surprised by the decision. But even if it had gone Aereo's way, he doubts the impact would have been as dramatic as the pro leagues feared.

"if Aereo had 50 million subscribers, I could see a win by them as a game changer," argued Conrad. "But as small as they are, I don't necessarily see a reason for too much panic by the leagues."

"Most people still want to see their sports on TV and not the Internet," he added.

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However, SDSU's Copic said the fear broadcasters and the sports leagues have about losing customers to advancing technology will likely get stronger in the years ahead.

Disclaimer: CNBC's parent company, NBCUniversal, is among the broadcasting and cable companies that opposed Aereo on copyright claims before the Supreme Court.