Why do broadcasters want to stop Aereo?

Aereo logo

A new TV service, Aereo, formally launched this week. Aereo is the old Bamboom (previously discussed here) with a new name and deeper pockets. And those pockets are needed to defend against the inevitable lawsuits from broadcasters.

Aereo’s plan is to install a tiny over-the-air (OTA) TV antenna for each of its subscribers, then stream the programming from that antenna to only that subscriber over the internet. They’ll only stream within the subscriber’s market, so a New York viewer can’t buy anything but New York channels. But Aereo will be streaming those channels without anyone’s permission and without paying any retransmission fees. TV stations hate it when you do that.

Aereo’s paradigm is different from those of my beloved ivi.tv and FilmOn, which both lost all of their major OTA channels when injunctions went against them. I think it’s got a chance in court. But I’m not so sure how many viewers will want to pay $12/month for channels they can get for free OTA.

While the broadcasters’ case against Aereo is pending, both sides are also presenting their positions in public. The article that got to me today is in Multichannel News, in which a New York Latino community activist says that major networks won’t give as much support to Spanish-speaking communities if they don’t get retransmission money.

That doesn’t make sense to me. Any local viewer with a decent OTA antenna can watch these channels for free right now. That’s what Aereo says it’ll do: stream in-market from a rented OTA antenna. Aereo might make it easier to watch some weaker signals, which include a higher percentage of Spanish-language channels.

Broadcasters are looking for the younger, device-savvy, cord-cutting audience. Until OTA technology reaches devices (and it’s coming), this is a way to ensure that this new audience stays with OTA broadcasting. Fighting Aereo to prop up a bit of immediate cable/sat retrans cash is short-sighted.

Unless you consider that the parent companies of the big OTA networks are heavily invested in cable channels. The emerging OTT and OTA technologies are starting to pull customers away from those lucrative ventures. Could that be the real reason OTA networks don’t emphasize OTA reception? It sure would be a good reason to try to kill off Aereo.