updated 08:11 am EDT, Tue July 22, 2014
Future of service unclear, with low adoption and very slow growth
Nascent television streamer Aereo appears to be in rough shape, above and beyond just the Supreme Court ruling, and US Copyright Office declarations. The company's subscriber numbers are dismal, with a total of 77,596 subscribers at the end of 2013, making it unclear what traction the service may have if it continues operation, or has to raise its rates in the wake of defeats it has been dealt recently.
The courtroom battles between Aereo and broadcasters revolves around content licensing. Aereo claimed that it was providing a "non-public performance" to its users, a key clause of the Copyright Act, due to its use of assigned antennas and user-specific copies of shows recorded from broadcasts. As such, the company believed it should not be liable for rebroadcast licensing. Invoking odd allegories for the situation, the Supreme Court believed otherwise, with the company giving all of the appearance of a cable company, despite its background machinations.
Of Aereo's subscriber base, 27,000 came from New York City, with Boston pulling down 12,000. Newer market Atlanta had 10,000 subscribers. Electronista has learned that 95 percent of the subscriber base in each area are one month after launch, with extremely slow growth after the first month of launch. Churn is low, with a very small percentage leaving the service each month, prior to its forced shutdown and "regrouping."
The copyright's office is accepting Aereo's filing of a Chapter 111 statutory rebroadcast license on a provisional basis, just based on court filings -- this does not mean that Aereo will be granted a license, despite the Supreme Court calling it "for all practical purposes a traditional cable system" and subject to rebroadcasting fees, however.
"It is astonishing for Aereo to contend the Supreme Court's decision automatically transformed Aereo into a 'cable system' under Section 111 (of the Copyright Act) given its prior statements," complained broadcasters after Aereo petitioned the US Copyright Office for a license. The broadcasters claim that existing court business should play through before Aereo is allowed to make its new Section 111-based argument, as Aereo has "been violating Plaintiffs' exclusive rights to publicly perform their works for over two years, during which time Plaintiffs, as this Court held, have suffered irreparable harm."