In response to escalating TV broadcast fees, AT&T and Dish Network are exploring the options of integrating Aereo’s internet video platform, so subscribers can receive signals from their local TV stations and watch their favorite programs on the internet.
Aereo uses dime-sized antennas, which receive over-the-air signals from local TV stations. The signals are then converted to HTML5, which enables customers with smartphones, tablets, PC’s, and laptops to watch any program being broadcast by their local TV station.
Major broadcasters like ABC, Fox, CBS, and even pay TV giant Comcast (who owns NBCUniversal) have filed a copyright infringement lawsuit against Aereo, claiming that the company was making illegal copies of copyrighted content with its technology. The big fear is that Aereo may make the current media compensation model obsolete, and may affect the major broadcasters the same way Napster and iTunes affected the music industry.
However, a New York court sided with the beleaguered internet start up, angering and disappointing broadcasters. Particularly galling for the broadcasters is the fact that Aereo does not pay for retransmission fees, which cable and satellite TV providers like Time Warner Cable and DirecTV have to pay in order to provide content for their subscribers.
With the latest court victory, Aereo is set to expand to 22 more cities and has attracted the attention of the pay TV industry. Last year, consumers saw a negotiating war play out between their cable and satellite TV provider and the broadcasters. Partnering with Aereo could give pay TV providers the leverage they need to hit the brakes on rising retransmission costs—which may give consumers the much needed break they have been looking for in a tight economy.
So far, neither AT&T or Dish Network have released any concrete details regarding their plans with the online streaming company.