Winding up for the Hail Mary pass.

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Winding up for the Hail Mary pass.

Media


Video startup Aereo spent years arguing it shouldn’t have to pay local TV broadcasters for the right to stream their channels online like cable operators. One failed Supreme Court challenge later, Aereo has had a change of heart.

The video streaming company told a U.S. district court in New York Wednesday it now thinks it’s entitled to be licensed as a cable system because of the Supreme Court’s decision. That would allow the company to stay alive although it would have to pay licensing fees in addition to costs to restart its stalled business.

Aereo allowed consumers to watch local TV channels over the Internet for a monthly fee of up to $12 until shutting down its service a few weeks ago after the Supreme Court sided with broadcasters and said the company was violating federal copyright laws.

“Aereo has been careful to follow the law and the Supreme Court has announced a new and different rule governing Aereo’s operations last week,” the company wrote in a court filing Wednesday. When the Supreme Court called Aereo a cable system that was significant, the company now argues, because it means it’s entitled to be licensed as such under copyright laws.

Four years ago, a lower court rejected a similar argument from a video streaming startup, Ivi, which wanted to be considered a cable system under the Copyright Act. Aereo argued Wednesday that the Supreme Court’s decision overruled that lower court decision and means it should be allowed to restart its operations as a cable company.

Several industry observers, including BTIG Research’s Richard Greenfield, made a similar point a few weeks ago, suggesting that the high court had possibly opened the door for this sort of argument from online video streaming companies.

But Aereo’s new strategy represents a bit of a leap for a company built around the idea of not paying fees to broadcasters.

“I don’t want to be in the business of buying wholesale content and retailing it to consumers. That doesn’t make sense in the long-term,” Aereo CEO Chet Kanojia, told Re/Code’s Peter Kafka in those heady pre-Supreme Court decision days.

This is the second attempt by Aereo (which famously said it didn’t have a Plan B if it lost at the high court) to find some way to salvage its business.

Last week, Aereo issued a call to arms to subscribers, asking them to bombard Congress with calls and emails demanding legislators change the law. Presumably that didn’t go so well, since there hasn’t been much, if any, noise about Aereo from lawmakers since then.

Meanwhile, broadcasters offered a legal eye-roll at Aereo’s new strategy Wednesday.

“Whatever Aereo may say about its rationale for raising it now, it is astonishing for Aereo to contend the Supreme Court’s decision automatically transformed Aereo into a ‘cable system’ under the law,” broadcasters wrote in a letter they filed jointly with Aereo to the court.




8 comments
mattbrad
mattbrad

There you go Amy, write another idiotic article slamming one of the few companies who actually want to see the consumer happy and will make a stand against these big cable companies. Here's a novel thought - how about you write more articles bringing to light the corrupt practices of cable companies like Comcast? 

JMWJMW
JMWJMW

I believe the appropriate term is "playing for time and sympathy."  But, really, this is just Aereo "doubling down."  Their next plan will, obviously be to "go pirate."


Why this feint won't work is that dozens of companies have tried this work around and the Copyright Office referred the matters starting a decade ago to the Copyright Royalty Tribunal.  In a 70+ page ruling from the CRT from almost a decade ago, they provided chapter and verse as to why it would be unlawful for the Copyright office to approve such scams.  The bottom line is simply that the language in the Copyright Act does not permit such a license as Aereo (and FilmOn) are now pursuing.


Nothing has changed in the meantime to enable this Kanojian/David fantasy into a reality.  So, they are playing for time, but at least this time, they aren't infringing in the meantime.  Or, are they?

TKList
TKList

The workaround is Aereo can sell a box (like the Slingbox) and people can use it to upload whatever they want to watch to a cloud service provided by Aereo.

mattbrad
mattbrad

@JMWJMW - So tell me, what is the alternative for change here? By the tone of your post, I could infer you are happy with the current state of cable companies doing whatever the heck they want, charging whatever the heck they want? Let Comcast buy out Time Warner and own everything from the content creation all the way down to the "last mile" pipe to your home. That makes a lot of sense. 

rocketx2
rocketx2

@TKList That doesn't make any sense???  Aereo should build a box like Slingbox so you can watch TV on line like you can already do with a Slingbox???  Buy a slingbox.  There are already a dozen ways to collect free TV and serve it to your connected device. 


Aereo's plan A was stealing free TV and making you pay for it... this is just plan B it shouldn't work either. JMWJMW is correct.


Move on.

JMWJMW
JMWJMW

@TKList  The ambition here is to be a service provider, not another box seller.

mattbrad
mattbrad

@TKList - What?! I rented an antenna. They received the signal for free and using my rented antenna, so did I. What is so hard to understand about this? Further, why are people balking at a company who is one of the few willing to make a stand against big cable companies who want nothing more than to bleed you dry. 

hello
hello

The TV was always free. I just paid for the DVR Storage.

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