Plan B Options for Cord Cutters Following Aereo’s Supreme Court Defeat

If you thought Aereo, the technology that sent local TV station content to the cloud for viewing by paying customers around the world, was an idea that was too good to be true, the Supreme Court of the United States agrees with you.
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If you thought Aereo, the technology that sent local TV station content to the cloud for viewing by paying customers around the world, was an idea that was too good to be true, the Supreme Court of the United States agrees with you.

In the court case, the ABC TV network, along with other broadcasters, had filed an appeal to overturn a lower court ruling allowing Aereo to use its unique technology to “rent” individual antennae to consumers so that off-air programming from local television stations could be received and then sent via a cloud-connection to the paying consumer. Along with that, a “virtual DVR” service is available to store and replay off-air content for cloud transmittal to the consumer at a later time.

Aereo contended that what they were doing was no different than renting an individual antenna—one antenna to one customer—and connecting it to the consumer’s TV via the internet rather than running a hard wire from an antenna on the roof. No other non-broadcast channels, no premium services (e.g. HBO, Showtime, ESPN, etc.), no out-of-area channels. Just plain old TV delivered via a new technology concept.

On the other side of the case, the broadcasters and program owners maintained that what Aereo has been doing is “public performance” of their copyrighted content that Aereo just can’t snatch out of the air and charge someone to view. Just as cable companies or satellite providers can’t stick up an antenna and charge to deliver what is someone else’s content without permission and/or compensation, Aereo shouldn’t be allowed to profit on what they say is the back of someone else’s work and intellectual property.

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Lower courts bandied this back and forth and to the surprise of no one it ended up in the laps of the Justices of the highest court in the land. For those who were waiting, the decision is in. For those who want to read it in its entirety, you can click here.

In a six-to-three decision, the Court overturned the lower Circuit decision and ruled against Aereo. Led by Justice Breyer delivering the opinion of the Court Justices Roberts, Kennedy, Ginsburg, Sotomayor and Kagen concurred while the dissenting opinion was filed by Justice Scalia who was joined by Justices Thomas and Alito.

I’ll leave it to the wisdom of the Justices as to whether or not the opinion is correct, regardless of my thoughts on the matter one way or another. However, given the novel and somewhat complex new technology used by Aereo and the fact that it is a delivery vehicle that some readers might have either used themselves or provisioned in integrated systems for their clients, a few words are in order from the point of view of our part of the business.

As one might expect, the Supreme Court decision was hailed as a proper verdict by the winners and viewed as “…a big loss for consumers” by Aereo, with the latter quote from media mogul Barry Diller who was a major financial backer of Aereo. After the announcement on June 25, he told CNBC that the “…Aereolers fought the good fight. We did try, but it’s over now.”

That last comment is interesting, for as of my deadline there is no indication as to what lies ahead. One presumes that a literal interpretation of the decision means that sooner or later the service will have to shut down.
Indeed, as of this date there is no indication on the Aereo website as to what the future holds other than comments in a blog from Chet Kanojia, Aereo’s CEO and founder, where he calls the decision “a massive setback” for the American consumer.” While reports indicate that there is no “Plan B,” he continued on to say, “We are disappointed in the outcome, but our work is not done. We will continue to fight for our consumers and fight to create innovative technologies that have a meaningful and positive impact on our world,”

One can read between the lines on that to imagine that it is (perhaps remotely) possible that Aereo could make peace with the broadcasters, agreeing to pay retransmission fees as other multichannel video programming distributors (MVPDs) such as cable, satellite, and IPTV delivery services such as FiOS and U-Verse do. I’d LOVE to have the video rights to that meeting to see if the broadcasters extract a pound of flesh or simply say “Sorry, no way!” Without that, they are very dead in the water.

I did reach out to Aereo for comment but the spokesperson would only tell me that, “It's still unclear what this means immediately for Aereo customers. Aereo is still evaluating its options.” At this point, your guess is as good as mine as to what will happen. Time will tell, so if this impacts you or a client watch the news carefully. (For the complete text of Chet Kanojia’s statement, click here)

While Aereo might not have a “Plan B,” given the reasonable possibility of a shut down, if your clients are using Aereo, then you need one!

For that, a few recommendations for cord-cutters, with the caveat that in all of these cases you can’t have them completely cut the cord because broadband service is required for the delivery of EPG data and, where utilized, the ability to stream out programming. Yes, you could have them go back to an MVPD, but that is counter to the mantra of cord-cutting.

First, while you can’t use the small “dime-sized antenna technology” that Aereo promotes, the first thing is obviously an antenna. Depending on whether it is mounted indoors or outside, there are many choices that deliver outstanding results. I’ve used various models from Antenna Direct, Mohu, and Terk, particularly the latter’s Silver Sensor as our indoor antenna of choice with the Mohu Leaf as the most unobtrusive option. Mohu and Antenna Direct both have a variety of outdoor options as do other traditional antenna suppliers such as Weingard and Channel Master. Depending on the antenna placement and the home’s distance from the local broadcast antennae, don’t forget that an amplifier may be required, as well.

Once you’ve got the signal, it can be connected directly to any TV and your clients may well be amazed at the improvement of direct over-the-air ATSC images compared to those form an MVPD where compression is sometimes applied a bit too heavily. Remember to do a full channel scan and then sit back and enjoy. You’ll even find “hidden” digital sub-channels with additional educational, ethnic/foreign language, sports, shopping, nostalgia and specialized local content that the MVPDs rarely carry.

Now that you’ve got the reception and viewing taken care of, the missing piece of the OTA puzzle to provision is DVR and remote viewing. A number of options are available there.

Perhaps the easiest to deal with and explain are the solutions from TiVo, either the latest Roamio or an earlier “Series 3 HD” or “Premiere” with the latter sometimes available in the TiVo web site’s “Outlet” or on a regular basis from TiVo specialist Weaknees.com. A note of caution, however. For the Premiere and Roamio lines, only the basic models have ATSC tuners. If you select one of those and need a larger hard drive for more program storage Weaknees sells specially formatted drives you can use to swap out the factory HDD. We’ve done that upgrade ourselves and it is a snap.

Another DVR option for OTA is Channel Master’s “DVR+” that has the tuners and EPG connectivity on-board. All you supply is external hard drive to store the programs. A reasonably priced option in a small form factor that is also “Sling compatible” so that you can stream content to a remote display anywhere there is an internet connection and a Slingbox or device with the Sling app.

A bit more exotic are the products from Silicon Dust and SimpleTV. These products connect directly to an antenna and stream content from single or multiple tuners to any display that either has their app on-board, through an app on a Roku, or directly to a PC, phone or panel. Silicon Dust’s “HD Home Run” is more in-home centric to our take, while SimpleTV is more complete with iOS and Android apps along with an app/channel for Roku. We’ve used one of their older models to view programming both at home and from across the globe with some success and look forward to a test in the months to come of their latest model. Great idea, interesting product, but remember that you can’t connect either of these directly to a TV, but then again that’s what YOU are there for.

From a technology standpoint, Aereo is an interesting service. From a legal standpoint the Supreme Court decision is one that may well be used to determine future cases although in the majority opinion the Justices seemed as though they were trying to be careful to try to limit the opinion to this specific instance. Time will tell how all of this plays out in the long run. Will Aereo make peace with the programmers and continue, albeit after paying the fees for programming and undoubtedly raising their price accordingly? If they do that will it diminish their value proposition for even the most die-hard cord cutters?

Will they throw in the towel and shut down? We’ll know that soon, enough, as well. However, perhaps the best lesson here is that while it is always valuable to try new technology and services, always make sure that you have a back-up plan in case things don’t work out or the service shuts down. Barry Diller was quoted after the decision as saying “It’s not a big [financial] loss for us…” Easy for him to say that, but can you say the same? If not, better have that Plan B ready!

CEDIA Fellow Michael Heiss is a contributing editor to Residential Systemsout of Sherman Oaks, CA.

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