I am trying to understand what the current and future standing is on watching copyrighted material such as television shows online through websites not affiliated with the shows. Is it illegal to stream this content, and are there consequences for it, even though it is not being downloaded or distributed by the viewer? If so, what are they? Also, if it is illegal, is it actually possible for someone who might want to go after these viewers to do so, and how likely is it that they would?
Intellectual Property Law Attorney
Generally viewing streamed TV shows is legal. It is the one doing the streaming that has to worry about copyright infringement. However, receivers making multiple copies or re-streaming would likely infringe.
Receipt of video streams is not one of the exclusive rights enumerated in 17 USC 106, those being:
(1) to reproduce the copyrighted work in copies or phonorecords;
(2) to prepare derivative works based upon the copyrighted work;
(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending;
(4) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, to perform the copyrighted work publicly;
(5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, to display the copyrighted work publicly; and
(6) in the case of sound recordings, to perform the copyrighted work publicly by means of a digital audio transmission.
Note the last one, number 6, speaks to transmission not reception.
The law also clearly states that secondary transmissions unauthorized are infringing:
17 USC 111(b) provides:
(b) Secondary Transmission of Primary Transmission to Controlled Group.– Notwithstanding the provisions of subsections (a) and (c), the secondary transmission to the public of a performance or display of a work embodied in a primary transmission is actionable as an act of infringement under section 501, and is fully subject to the remedies provided by sections 502 through 506, if the primary transmission is not made for reception by the public at large but is controlled and limited to reception by particular members of the public.
Note that again the law speaks to transmission not reception.
When you receive a video stream, e.g. TV feed, your computer arguably makes at least one temporary copy (which is what "buffering" is technically about), which is subsequently destroyed unless you are allowed to download and/or save it and do so. If you use a DVR or computer to time shift, you are certainly making a copy. However, the current law has not really caught up with technology yet, and arguably fails to say that receipt and possession of a single buffer copy (even if unauthorized) is an infringement.
With the increasing ability of content owners to track file sharing to IP addresses and then subpoena identities of owners of those addresses, the copyright cheats have moved on to video streaming and the law has yet to really catch up. But copyright owners are rich, well lobbied, and very influential, so stay tuned as the law is likely to address and outlaw streaming of unauthorized content and technology may well catch up to make it somehow possible for copyright owners to capture the identity of the recipient of the unauthorized streams.
So the bottom line is that, for now, receipt of streamed unauthorized copies is likely not going to get prosecuted, but that is not likely to stand for long and the networks, studios and labels are not going to accept that for long and will lobby and litigate until it becomes illegal. Ethically you know you should not do this as you are cheating the artists and their employers, and keep tuned as you might end up the test case in which even if you win you are going to spend a fortune defending if you do not settle.
So far, this is free to you. Until you pay a fee, I am not your lawyer and you are not my client, so you take any free advice at your sole risk. I am licensed in IL, MO, TX and am a Reg. Pat. Atty. so advice in any other jurisdiction is general advice and should be confirmed with an attorney licensed in that jurisdiction.
Patent Infringement Attorney
The current thinking is (as Mr. Burdick said) that only watching the content online, and not storing or distributing any copies, probably does not violate copyright law. I believe most lawyers will agree with that, although I'm also sure that some won't.
That said, the lawyers who won't agree are the ones who work for the companies who own the copyrights. So yes, they probably will send you threatening letters if they find out who you are. And yes, it is possible that they will push it to litigation if for no other reason than to try and set a precedent or get the law changed. It is unlikely, but not impossible, that they would win.
Intellectual Property Law Attorney
You have received brilliant advice. But here is the practical truth. You can be fined or sued for watching television content on line unless the web-site that offers this service to you has a license to do so. Many television networks, news organizations and other internet broadcasters are more than happy for you to review their content. But others require payment of licensing fees or subscriptions before allowing you to review the content, If you watch television content without paying a subscription fee or license fee, you can sometimes get into trouble. All depends on context and specifics. No lawyer can say with certainty that you can never be sued for watching television content on line. My advice to you is that if you have been sued for this, you should take this very seriously. If you illegally download and view copyrighted materials, you can be liable for statutory damages of up to $150,000 for each work that you downland. That is a lot of money. So if you are unsure about whether you are free to download a television show, don't do it.