Tuesday, February 25, 2014

Is Aereo Stealing Or Adding Value To Broadcaster Signals?

According to the major broadcasters, "Aereo is engaging in theft on a massive scale and must be stopped."  They will get their day in court as the Supreme Court has agreed to listen to the case.  But while everyone argues, Aereo continues to grow markets and customers. 

Aereo argues that broadcast signals are being delivered to homes over free, over the air signals.  They are simply renting to consumers an antenna to capture those signals as well as additional services like DVR.  So is it stealing signals or not?  Broadcasters have been able to get cable operators to pay for access to their networks because of previous rules known as must carry and retransmission consent.  Some smaller broadcasters relied on must carry, requiring cable operators to carry their service, at no charge, to assure that their low powered signals gained wider distribution.  Others, charged for their networks.  Univision, a Spanish language broadcaster, successfully transitioned from must carry status to retransmission consent, as their network gained popularity.  For them, it opened a brand new revenue stream.

In these cases, broadcasters provided a signal directly to cable operators' headends, but Aereo has taken a different route.  By renting individual antennas, it has created a work around that seems to stay true to the notion of antenna carriage of broadcast signals.  That they deliver added services to the consumer and charges for rental and service in no way interrupts or interferes with the broadcaster.  And as long as broadcaster continue to use over the air signals, I believe that Aereo will continue to have a successful business.  That said, I believe that Aereo will win the Supreme Court case. 

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