Judge Weighs 'Slippery' Legality of Barry Diller's Aereo in Day 2 of Key Hearing

At the close of a two-day hearing to determine whether TV broadcasters will prevail on a motion for a preliminary injunction against Barry Diller's Aereo, a judge made no explicit indication of which way she is leaning. That said, one thing is clear from two days of testimony and arguments: If the Internet broadcaster survives, the revolution in how content is televised will be traced back to Aug. 4, 2008.

As the parties made closing arguments for and against an injunction, the potential impact of this case became apparent: It's huge. And to borrow the word used by New York Federal Court Judge Alison Nathan, what was being presented before her was "slippery." To understand why, consider that in 1984, in the famous Sony Betamax case at the U.S. Supreme Court, the VCR got legal blessing. Nearly a quarter-century later -- Aug. 4, 2008, to be exact -- remote-storage DVRs received a similar stamp of approval from the 2nd Circuit Court of Appeals in the so-called Cablevision decision. In that case, the appellate division ruled that "because each RS-DVR playback transmission is made to a single subscriber using a single unique copy produced by that subscriber, we conclude that such transmissions are not performances 'to the public,' and therefore do not infringe any exclusive right of public performance."

Now consider for a second what happens if someone builds a system where a DVR-type device captures an over-the-air TV signal and transmits it to a single subscriber over the Internet. What if the subscriber is able to "play back" the "copy" of the recording "contemporaneous" with the original live transmission?