The Supreme Court decided against Aereo; now the company is trying to cash in on the publicity. Can it win in the court of public opinion?
It's not easy being on the losing side of a Supreme Court decision. Unfortunately, that's where Aereo finds itself. As a direct result of the Supreme Court's ruling in ABC v. Aereo, the company suspended its service on June 28, 2014—without a clear path forward. Nevertheless, Aereo says that its shutdown is temporary and that it is exploring options for the future.
At the time it shut down, Aereo served approximately 500,000 subscribers in a handful of cities. That's a rather small subscriber base, roughly equivalent to the population of Tulsa, Oklahoma. But thanks to the court case, the company has received an oversized portion of publicity. Had the court decided in Aereo's favor, the company would undoubtedly be riding a tidal wave of publicity on its way to a huge IPO. However, the Supreme Court is not a PR
Aereo is the sort of technology upstart that typically doesn't have a Plan B, because Plan A is to disrupt the entrenched players. Uber did it for taxicabs, so why couldn't Aereo do it for broadcast TV? The answer lies in the way the court interprets copyright laws. Moreover, in Aereo's case, the court did not buy the company's argument that it was not re-transmitting content, but rather acting as a mere conduit for a free over-the-air TV signal.
The crux of Aereo's argument was that each customer merely rents an antenna used to receive local OTA broadcasts, which are streamed via the Internet. If there was a true weakness to Aereo's case, it was the dubious notion that one tiny antenna could discreetly to receive broadcasts for any one subscriber. The reality is that the little Aereo antennas were set up in large arrays, which ultimately acted as one device. That crucial technical detail meant that Aereo was selling access to copyrighted content without paying retransmission fees, as opposed to just renting a small antenna to each one of its subscribers.
Aereo is trying to prove the maxim that there is no such thing as bad publicity. With a rebranded website, the company is imploring its supporters to "protect my antenna." In a statement issued a couple of weeks ago, Aereo CEO Chet Kanojia asked his supporters to reach out to their elected representatives in protest of the Supreme Court's decision. The company maintained that each individual antenna belongs to a subscriber, that it only acts as a conduit to deliver free over-the-air broadcasts to its customers, and that the Supreme Court made the wrong decision. The problem is that Supreme Court ruling are permanent, and they firmly establish legal precedent.
So now, Aereo is looking at another path to legitimacy. Instead of fighting the ruling, the company is examining the possibility of embracing the Supreme Court's decision. In fact, Aereo is making the case that it is now essentially a cable company, thanks to the court's ruling. If Aereo's claim holds up under further legal scrutiny, the newfound status would entitle the company to what's known as a statutory license. According to CNET:
"If Aereo is a 'cable system' as that term is defined in the Copyright Act, it is eligible for a statutory license, and its transmissions may not be enjoined," the company wrote in its letter to the Second Circuit. It added that it has begun to file the necessary paperwork and royalty fees under the statutory license. - read more at CNET.com
It's hard to tell if Aereo is merely surfing on the wave of publicity it generated with its Supreme Court case, or if it genuinely has a workable strategy to emerge victorious. No matter what happens next, it's clear that the next iteration of Aereo won’t resemble the last one. What's your take, does Aereo deserve another shot at disrupting the market for delivering OTA (over the air) content to people's homes?