Germany: A shift from rights infringement to rights acquisition

This article was produced by Olswang LLP, which joined with CMS on 1 May 2017.

Under US law as well as under German law, services like Aereo that allow subscribers to watch live television broadcasts over the internet touch upon different aspects of copyright, from the reproduction to the (re)transmission of protected works. In the Aereo case, the US Supreme Court concentrated on the aspect of Aereo's offering that allowed the user to stream the program (almost) contemporaneously with the over-the-air broadcast. The judgment does not relate to services that allow users the remote storage of content.

As regards the question of an illegal transmission of protected works, the Supreme Court's decision in many ways corresponds with the case law developed by the German Federal Court of Justice (BGH) with regard to online video recorders (the Shift.TV and Save.TV cases). Much like Aereo, these services captured an over-the-air broadcast, translated the signals into data that can be transmitted over the internet and stored the data in a subscriber-specific folder on their servers. In each case, the process was triggered by the individual subscriber's request for a program. As neither Shift.TV nor Save.TV had acquired any licenses in the content, two of the largest German broadcasters had sued for an infringement of their rights. Like the Supreme Court in Aereo, the BGH held that operators infringed the transmission right by passing the broadcaster's signals on to the subscriber's folder on the hard drive.

Contrary to the Supreme Court, the BGH also had to analyse whether the service resulted in illegal copying. In this context, the court found that the reproduction of the broadcast on the operator's servers could be attributable to the user (at whose request the copy was produced and who, depending on the technical set-up, could invoke a private copying exception). However, with regard to the transmission right, the BGH just like the Supreme Court ruled that the operator's service constituted an illegal retransmission by the operator. The BGH argued that, the service was not limited to the passing on of the signal of programs the operators had included in their offering. Rather, the operators had, at the same time, "offer[ed] the customers the capacity to receive the signals." Their activities were therefore "comparable to activities that are reserved for the author of the copyrighted work by the law."

Like the Supreme Court, the BGH (in line with the case law of the ECJ) also held that the transmission constituted a transmission "to the public". The fact that each subscriber received an individual copy of the program in their folder did not alter this assessment: As the transmitted signal was made available in parallel to a larger number of subscribers that were unrelated to each other, these subscribers, collectively, had to be considered a public. In this context, it has to be noted that neither Shift.TV nor Save.TV operated mini antennas that could be assigned to the individual subscriber. It is, however, doubtful if such a technical feature would have altered the BGH's assessment.

In view of the aforementioned case law and recent case law of the ECJ, the focus of the debate on online distribution of TV signals seems to shift from the question of rights infringement to the question of rights acquisition. Decisions such as the Aereo judgment may contribute to this development. In this context, it is worth noting that, based on an EU directive; the right for cable retransmission of broadcasted works can be acquired from collecting societies which are under an obligation to contract. As the broadcasters, too, are under an obligation to license the cable retransmission rights in their signal on adequate terms, the operation of cable systems is greatly facilitated in comparison to the operation of online TV platforms. In view of the newly emerging forms of online TV consumption, the extension of this privilege to other operators of retransmission services, regardless of the technology employed, has been heavily debated in Germany. Should such a legislative decision be taken, this would considerably alter the legal environment for the provision of online TV and VCR services in Germany in the future.

To learn more about the implications of the Aereo decision, read our Aereo and the future of cloud TV report.