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Two Sides of an Aereo Cookie
By: Mike Bush
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If you live outside the NYC area, or don’t follow the cable industry heavily, there’s a chance you haven’t heard of Aereo, an over-the-top service that has cable companies up in arms (and filing lawsuits).
 
The service works as follows:
 
Aereo basically grabs over-the-air TV programming (think of the major networks, CBS, Fox, etc), then changes the feed to something more Internet-friendly. Subscribers who pay Aereo $1 per day, $98 per month, or even $80 per year also have the ability to DVR shows and then watch on their schedule, and on the device of their choosing (TV or Tablet, etc). A better description of how everything works can be found here.
 
The cables companies sued, saying that Aereo is violating copyright, but ultimately lost the court battle and subsequent appeal.*
 
It’s exciting for Aereo, but Frost & Sullivan streaming media analyst Dan Rayburn cautions us not to believe that the court decision, which has been hailed as a potential disruptor to cable, is a true “killer.”
 
From Dan’s post on the Streaming Media Blog:

The [GigaOm] post called Aereo’s court ruling from yesterday the “biggest blow yet to the existing TV business,” which in reality, is simply not the case.

Later on, Rayburn goes on to discuss the actual biggest thereat to cable providers…

The biggest disruptor to cable TV isn’t Aereo, Netflix or some other content service. The biggest disruptor to cable TV is themselves and the content owners who continue to raise their content licensing rates to the MSOs. At some point, cable TV operators will lose subscribers if they continue to raise rates every year like clockwork. And if they don’t learn and don’t realize that consumers are only willing to pay so much, then they will lose subscribers over time.

He very well may be right.
 
Other than humoring my unrelenting desire for a la carte selection of channels and fair pricing, what does this all mean to flacks?
 
Here’s what we can learn right now:
 
The major networks will not be going away any time soon. Even if the cable industry is forever changed, getting our clients on network TV should still absolutely be something we strive to achieve.
 
*One of the key differentiators for Aereo vs some of the other companies that have tried to take on Cable is that Aereo is backed by, among others, Barry Diller of IAC fame. The group Diller is a part of has fronted at least $58 million to Aereo…. It helps to have a war chest with which to go to war.


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About the Author
Mike Bush is a PR and Marketing freelancer with more than a dozen years of experience in the field. Find him on and connect Twitter @mikebush or at www.mikebush.nyc. 
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