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June 25th 2014 11:11 am

Aereo deemed illegal by the US Supreme Court

After much back and forth it looks like Aereo has lost its battle in the Supreme Court. Today, the court ruled that Aereo is illegal citing that it operates no differently than CATV companies that operated in 1976. Put simply, the Copyright Act deems that rebroadcasting of any airwave TV is subject to broadcast fees.

If you're unfamiliar with Aereo, they used over-the-air antennas to deliver content to their subscribers. As part of your subscription you were given a DVR to record your content. All of this was accessible from your phone, browser or even Roku.

This is a huge blow to Aereo and could prevent other companies from trying to deliver a similar service. And to be honest, I didn't think Aereo was going to make it out of this unscathed. As much as I wanted them to win and hopefully shift the current paradigm of TV content delivery, they were technically breaking the law.

Having used the service, I can't say I'll miss it. It was ok for what it was, but it also wasn't the fastest service out there. Still, I know that people did enjoy the service and it was a great way to cut cable without losing access to local news.


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I'm a bit bummed by this because I'm in favor of companies trying new things, especially new things that might compete with existing services and hopefully drive down prices.

However, keep in mind this isn't the death of Aereo. They can probably offer the same, or a modified service, if they start paying rebroadcasting fees similar to what cable companies pay. Over the past few years, we've seen an ongoing tug of war between cable companies and the broadcasters over paying for over-the-air television. Sadly, cable broadcasters have capitulated to the broadcasters' demands for the most part, and yet, cable bills haven't shot up as a result. It's worth noting that you can get a "Broadcast Basic" package of 60+ channels for $15 a month (before equipment fees) from Cablevision. (Presumably other cable companies offer similar packages at similar prices.)

So I guess what it comes down to is: how much is Aereo worth to you? What would you be willing to pay for a service that provides you access to broadcast TV from anywhere? (Which technically, is something that cable companies provide as well, given the increasing ubiquity of apps that let you watch your cable on-the-go.) When (not if) they increase their prices, what does, or what can, Aereo offer over the competition?
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My only issue with the $15 comparison is that cable companies may be able to eat the fees on that since they're packing and bundling other channels of those networks. Additionally, that $15 does not get you a DVR, which bumps that cost up a lot.
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Oh, I won't deny the point about equipment, but everyone's been talking about content access first, not equipment. They only bring up equipment when I point out that content access is roughly the same cost. Now, Aereo will have to start paying for content. The question is how much -- if they can still undercut the cable companies, then it's still a very viable, very solid option for subscribers.
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That's too bad, really. I was hoping for some more competition to Cable.
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