There’s a lot of nail biting going on in TV network boardroom this week after a pair of appeals court judges ruled that Aereo—the micro-antenna based startup backed by Barry Diller et al.—agreed with U.S. District Court Judge Alison Nathan’s decision earlier this year to continue allowing Aereo to stream live TV via its nascent network.
In denying a heavyweight slate of broadcaster’s bid to shut the service down, the two judges from the U.S. Court of Appeals for the Second Circuit wrote that the plaintiffs had failed to present adequate testimony that the service was copyright infringing, and said: “We conclude that Aereo’s transmissions of unique copies of broadcast television programs created at its users’ requests and transmitted while the programs are still airing on broadcast television are not ‘public performances’ of the Plaintiffs’ copyrighted works under Cablevision.â€
The service allows users to watch local TV channels streamed across an Internet connection from Aereo’s offices. The key? Each user “rents†a tiny antenna located at the Aereo facility for a monthly fee. For a couple of bucks more, users can also rent some cloud storage and watch that content when they want to.
For the moment, only users in New York City have access to Aereo, but that’s likely to change following this ruling, as the company has already announced plans to roll out service in several other cities.
What’s it really mean? Aereo will expand its service—which can cost as little as $1 a day, and that will prompt more cord cutting among consumers who already wanted to cut the cord but didn’t want to lose access to their local channels. For New Yorkers, that means local news and weather, all the network TV they can consume and, here’s the real kicker, live sports… the NFL, MLB, NHL, NBA, NCAA, all of it.
Live sports have long been ballyhooed as the reason pay-TV subscribers wouldn’t abandon their pay-TV services. In a place like NYC, reception of over-the-air signals also has been problematic (I know, I outfitted more than one set of rabbit ears with aluminum foil in an attempt to get Giants’ games snow free on a Sunday afternoon before buying my first cable contract).
Aereo is likely to face additional legal challenges, but it’s got reasonably deep pockets thanks to backers like Diller, and it’ll find it easier to survive than some other startups that have been pushed out of line by the broadcast industry.
Like many companies in tour industry, Aereo isn’t just about new technology, it’s about responding to consumer demand—strong consumer demand—to get content when and where they want it, and, increasingly, at an affordable price.
There has been a lot of resistance to the idea of change, be it the dawn of a la carte, OTT growth, cord cutting, whatever, in the industry and in the trade media. But, the reality, and it’s pretty clear to most industry analysts, is that change, big change, is on the way.
Fasten your seat belts, we’re in for a bumpy ride.
I’ll be at NAB next week and I have a few slots still available to meet. Drop me a note at jim@radi8creative.com. I’m also moderating a panel (which includes a free breakfast) on Tuesday morning at the Renaissance Hotel. Join me at Verimatrix’s Multinetwork Forum: Engaging with the Connected Consumer. See more info here.
–Jim
Jim O’Neill is Vice President, New Media at Radi8 Creative. He previously was editor of FierceIPTV and FierceOnlineVideo, and an analyst focusing on new media at Parks Associates.
