Why cloud companies are watching the Aereo, Supreme Court case very closely

Are cloud providers responsible for the content of what's stored on their servers?

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The U.S. Supreme Court this week heard arguments in a case involving Aereo, a startup that allows users to access broadcast television networks without paying big-brand cable companies expensive contracts.

Cloud storage services are wrapped into this case as well though because Aereo uses hosted servers to store the content, giving its customers the ability to stream it on demand.

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The nine Justices of the high court seemed to skeptically question Aereo's practice of circumventing licensing fees that traditional cable and content providers pay to networks to access their content. Instead, Aereo rents subscribers an antenna to create what some have called a modern day version of television "rabbit ears."

Depending on how the court rules though, it could have impacts beyond just Aereo's fundamental business of streaming the network content, but it could also impact the cloud storage providers that get wrapped into this.

Fundamentally the question has arisen: If the court strikes down Aereo's practices, are the cloud providers that are storing Aereo's content implicit here as well?

If so, companies like DropBox, Amazon Web Services, Google, Microsoft and many others could be greatly impacted. And more importantly, it could open a Pandora's Box for cloud providers being responsible for the data customers store in their clouds.

To the relief of cloud providers, the Justices in Washington D.C. seemed to understand and separate Aereo's streaming practice and the content storage aspect of the business. Justice Stephen Breyer even asked "How do we get out of" impacting cloud computing companies in deciding this case. That's good news for the cloud providers if the status quo practice of how content is managed in the clouds remains.

Currently, the rules for most cloud providers are pretty simple: Customers, not the provider, are responsible for the data in the cloud. Vendors are simply offering a utility for storing information, but they're generally not responsible for the contents of their customer's information.

No one knows how the high court will rule. Reading the tea leaves of the Justices based on transcripts of the oral arguments is not a sure-fire way to glean insights on how the court will lean. So, when the court does render its decision, it will be watched very closely by cloud computing companies. 

Senior Writer Brandon Butler covers cloud computing for Network World and NetworkWorld.com. He can be reached at BButler@nww.com and found on Twitter at @BButlerNWW. (Photo credit: Ron Chapple Stock)

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