Econintersect: Aereo is a new technology which says on its website that “you can watch real, live TV through a tiny remote antenna you control over the internet“. The technology was launched in 2011, backed by media mogul Barry Diller. The broadcast networks have been contesting the legality of the “use of their copyright material” without payment of transmission fees, such as those paid by cable companies. The Supreme Court is expected to issue a ruling on these claims this month, possibly as early as tomorrow (Monday, 23 June 2014).
Aereo claims that they have nothing to do with transmission of content. They say that they are simply offering the same antenna and DVR (digital video recording) processes from a remote location using the cloud and signals broadcast on the internet that an individual could use with local equipment at home. Aereo’s position is that they are simply offering the customer the convenience of using remote rental equipment rather than having his own equipment at home.
Whichever way the SCOTUS comes down on this case more people will “cut the cord” to cable services. If Aereo wins then the internet as a free broadcast medium will be strengthened And Aereo (and other ventures) will grow rapidly. If the broadcasters win then they will feel emboldened to hike fees because of reduced competition from their free broadcasting activity. If fees go up, more people will discontinue the more expensive cable and satellite services. Broadcasters appear to be losers either way.
Sources:
- Aereo (Company website)
- This Supreme Court decision could alter TV forever (Matthew J. Belvedere, CNBC, 17 June 2014)
- Cutting the Cord: Aereo decision could be turning point (Mike Snider, USA Today, 21 June 2014)
