The big broadcasting companies are finally getting their day in court. In 2019, ABC, CBS, NBC, and FOX joined forces to sue Locast, a non-profit streaming service they claim is violating their copyrights. Now, the “Big 4” have submitted a letter to the U.S. District Court of New York to outline their case against Locast.
Locast bills itself as a non-profit that streams local news channels to over 2.3 million subscribers in 30 local areas for free. Locast says it requires no subscription fee but instead asks for donations to keep it afloat. These donations cease being a suggestion and become almost a requirement after about 15 minutes, when you’ll lose access to the stream you’re currently watching and get booted back to the channel guide. You can either keep returning to the channel every 15 minutes in a Sisyphean-like manner or pony up some cash (the “recommended donation” is about $5) to receive a month of break-free streaming. After the month is up, though, Locast will ask for more.
While this might not be a “subscription,” it seems to act as a “freemium” service, similar to those pesky mobile games that ask for a few bucks to remove all the soul-sucking ads. The difference between these two business is 1) the mobile games don’t charge you every month to maintain your ad-free status and 2) the mobile game companies don’t bill themselves as non-profits.
The networks cite the 1976 Copyright Act, saying that Locast is trying to hide behind the act’s “local media” clause, which allows for nonprofits to operate “booster and translator stations” (stations that strengthen a TV station’s signal to reach antennas that otherwise wouldn’t receive the channel.) However, as Locast is technically a national service, they aren’t complying with this section of the law. Secondly, the channels argue that Locast cannot prove it doesn’t transmit secondary broadcasts “without any purpose of direct or indirect commercial advantage.” Lastly, the channels argue that Locast isn’t truly a “non-profit” since it “charges” users to use its product in the form of monthly donations. The last point may be the group’s strongest case.
Within the larger context of the lawsuit, the stations claim Locast is retransmitting signals of their local TV stations without permission, stripping the feeds of key indicators like Nielsen ratings. The networks also claim that should Locast gain popularity, it could cut into the revenue stream broadcasters receive from pay TV distributors. In addition, the networks also claim that if Locast is truly a nonprofit, and not helping AT&T and Dish, then there is no reason to require registration or gather its own consumer data — both of which Locast currently does.
In a countersuit filed, Locast accused ABC, NBC, Fox and CBS of collusion, claiming the networks interfered in a potential partnership with YouTube TV by disallowing it to provide access or Google would be “punished by the big four broadcasters.” Locast suggested the broadcasters could band together and pressure Google and other pay-TV operators by refusing to sell their cable channels. In response to the “Big 4” lawsuit, Locast argues that it is well within the 1976 Copyright Act. Locast’s legal team also points out that these networks “have been aware of Locast’s activities for around a year and a half and have never made any claims.”
Locast’s parent company, Sports Fans Coalition NY, also makes the claim that nobody is taking commercial advantage of the service since no one individual owns it, despite financial backing from AT&T and Dish, other non-profits often take on commercial endeavors to further their charitable mission, and that more than half of those 2.3 million users don’t make donations.