As Aereo threatens to alter TV landscape, major networks promise a fight

[JEK]

As Aereo threatens to alter TV landscape, major networks promise a fight

Bebeto Matthews/AP -​

Chet Kanojia, founder and chief executive of Aereo, shows a tablet displaying his company's technology, in New York. Aereo is one of several start-ups created to deliver traditional media over the Internet without licensing agreements.



By Cecilia Kang, Published: April 8


For consumers who want to cut their cable cord and get all of their television from the Internet, there’s been a major obstacle: It’s hard to get live sports and local news.
Now a Web start-up, called Aereo, is offering to remove that last barrier with a simple method. It is using antennas to pick up programming from public airwaves and then deliver shows into homes that have a Web connection — for as little as $10 a month.

With Aereo planning to expand its service to Washington and 21 other markets this summer, CBS, ABC and other big networks have attacked the upstart company with renewed vigor.
In lawsuits, they argued Aereo is little more than a content thief. But their efforts to persuade federal courts to shut it down have failed. On Monday, Fox television’s parent company fired back, saying it might consider delivering its shows only through cable connections, no longer broadcasting them.
“We won’t just sit idle and allow our content to be actively stolen,” said Chase Carey, president of News Corp., which owns Fox Television.
The battle over Aereo, which was founded barely two years ago, underscores the television giants’ growing fears of the disruptive force of Internet video. With Web connections fast enough to deliver high-quality picture and sound, the cable and television industries’ long hold on the living room is loosening, with weighty implications for the way programming is created and distributed.
Faced with cable bills that typically reach well over $100 a month, 5 million households have abandoned cable, up from 2 million in 2007, in favor of much cheaper Web-based options, according to Nielsen. Netflix, for instance, offers an array of movies and TV shows to those with an Internet connection for a subscription of less than $10 a month. Through Apple and Amazon.com, consumers can pay a few dollars for each show they view.
As these alternatives have grown in popularity, the traditional model of television — which has long financed the creation of shows and padded the profits of cable companies that distribute programs — has trembled. But it has been able to hold its ground as the only source for the latest shows and live sports.
Aereo offers all of the programming that appears on CBS, NBC, Fox, ABC, PBS and about two dozen other channels. Customers could see NCAA tournament games live or the most recent episodes of “American Idol” or “Dancing With the Stars.”
Such shows are also freely available to consumers who use antennas to get their television. About 54 million people still watch over-the-air broadcast television.
But on top of that content, Aereo also allows for pausing live TV or recording shows and saving them for later — features once exclusive to subscribers of cable or satellite services. The company eventually envisions allowing consumers to pay for only what they watch, similar to ordering food items off an a la carte menu.
“All we are doing is giving consumers an alternative to what is now an utterly irrational system where people have to pay too much for so many channels,” Aereo chief executive Chet Kanojia said in an interview Monday at The Washington Post.

​https://aereo.com/devices​

 

[andynap]

Fox threatened today to go paid TV

http://www.huffingtonpost.com/2013/04/08/news-corp-fox-cable-aereo_n_3038921.html

 

[BBT]

I wish they would

 

[JEK]

Broadcasters Circle Wagons Against a TV Streaming Upstart

Kirsten Luce for The New York Times​

Aereo uses antenna farms to capture broadcast signals that can then be streamed on the Internet and viewed on a device of the customer’s choosing.

By BRIAN STELTER


When Chase Carey, Rupert Murdoch’s top deputy at News Corporation, told broadcasters on Monday about his contingency plan to turn the Fox network into something available only on cable, he knew policy makers would be listening, too. But a few of them were busy that day, meeting with Chet Kanojia, the very man who had provoked Mr. Carey’s stark warning.
Mr. Kanojia had come to Washington to sell lawmakers and reporters on the virtues of his upstart service, Aereo, which scoops up the free signals of local television stations and streams them to the phones and computers of paying subscribers. Because Aereo cuts off the stations from the retransmission fees that they have grown to depend on, they are determined to shut down the service — even, the station owners say, if they have to take their signals off the airwaves to do so.
Mr. Carey’s suggestion was dismissed by some as a hollow threat intended to scare the courts — which have ruled twice in favor of Aereo so far — and perhaps prod Congressional action. It is, at best, a far-fetched outcome. But it revealed a lot about the state of broadcasting, which appears increasingly antiquated in an age when wireless companies like AT&T and Verizon — instead of TV stations — are snapping up spectrum and using it to deliver Internet services like Aereo.
The networks aren’t just concerned about Aereo, which has a tiny following, but about copycats. “It’s Aereo today, but it could be something else tomorrow,” said Robin Flynn, a senior analyst at SNL Kagan.
For several decades companies that were lucky enough to own licenses for local TV stations thrived on advertising revenue alone, and because there was relatively little competition they enjoyed huge audiences and profit margins to match.
As cable and then the Internet introduced new competitors, station owners began to rely on a second revenue source, the so-called retransmission fees that come from the cable and satellite operators that pick up their signals and repackage them for subscribers. Now that they’ve had a taste of these fees, the stations aren’t willing — or able, they say — to go back to the old model of advertising alone.
SNL Kagan estimates that station owners took in $2.36 billion in retransmission fees from subscribers last year. (Some of that money is pocketed by owners, while a portion is paid to the network that the station is affiliated with, like Fox or CBS. Each of the networks also owns some stations outright.)
The research firm projects the fee revenues to hit $6 billion by 2018. The trend lines for broadcasters are similar to those in the newspaper and music businesses — subscribers are paying a bigger and bigger piece of the overall cost of content creation.
That’s why the stations are doing battle with Aereo, because it doesn’t pay any fees, the same way antenna users do not. News Corporation, the Walt Disney Company, Comcast, the CBS Corporation and Univision, all of which own stations in New York, sued Aereo shortly after the service was announced last year, accusing it of copyright infringement. But the media giants failed to win a preliminary injunction against the service last summer, and their appeals were rejected last week in a 2-to-1 decision in the Second Circuit Court of Appeals in New York.
Aereo’s success in court could embolden cable and satellite providers to do their own end-runs around retransmission fees. So now the station owners are plotting their next moves.
“We won’t just sit idle and allow our content to be actively stolen,” Mr. Carey said after speaking on stage at the National Association of Broadcasters conference in Las Vegas. “It is clear that the broadcast business needs a dual revenue stream from both ad and subscription to be viable.” If the revenue from retransmission fees starts to erode, he said, “one option could be converting the Fox broadcast network to a pay channel”
“It sounds like an idle threat,” said John Bergmayer, a senior staff lawyer for Public Knowledge, a public interest group in Washington. Mr. Bergmayer called Mr. Carey’s comments “probably just part of an opening gambit to Congress,” noting that the broadcasters could press for a change to copyright law that would effectively choke Aereo out of existence.
Mr. Carey’s comments also seemed meant to reassure affiliates. “He made clear that moving to a cable network isn’t their preference,” Ms. Flynn said.
The head of the board that represents Fox-affiliated stations said Tuesday that it backed Mr. Carey, and suggested that the stations could start broadcasting two flavors, a light version over the airwaves that would be without hit sports and entertainment programming, and a fuller version for subscribers to cable and satellite providers that pay the necessary fees.
On Monday night, the chairman of Univision, Haim Saban, became the first rival to back Mr. Carey publicly, saying that his network, the largest Spanish-language broadcaster in the country, would also consider converting to a cable channel. Representatives for NBC, which is owned by Comcast, and ABC, which is owned by Disney, declined to comment on Tuesday. But Steve Burke, the chief executive of NBCUniversal, expressed his support for Mr. Carey’s point of view privately, according to a person who insisted on anonymity.
Leslie Moonves, the chief executive of CBS, said in a telephone interview on Tuesday that he “wholeheartedly supported what Chase said.”
CBS has already had some exploratory talks with cable operators about taking its local station signals off the air. “For now, we’re talking about the New York-Connecticut area,” Mr. Moonves said, because that’s the only area where Aereo now operates. He emphasized that he does not want to go down that path, and said, “Frankly, we don’t think it will get to that point.”
Aereo has said that it plans to expand to nearly two dozen cities this year. (Not to the West Coast, however; a district court has halted an Aereo-like service there, so that is risky territory for the time being.)
Lost amid all this saber-rattling is the sobering fact that millions of Americans receive television via only antennas, and would be cut off if the television industry moves toward a pay model. As Bill Reyner, the owner of the Fox station in Rapid City, S.D., said to The Associated Press on Tuesday, “The real loser in all of this are those that can’t afford pay TV.”










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[MIke R]

blows my mind that my Mom has an old crappy pair of rabbit ears behind her TV and gets something like a dozen HD quality channels on her flat screen....for free...including all the major networks

 

[andynap]

blows my mind that my Mom has an old crappy pair of rabbit ears behind her TV and gets something like a dozen HD quality channels on her flat screen....for free...including all the major networks

My guess is you live too far for an air signal

 

[JEK]

There is a website for that http://transition.fcc.gov/mb/engineering/maps/