Inside the tech aiming Aereo through TV's legal hoops

http://www.cnet.com/news/inside-the-tech-that-tossed-aereo-through-tvs-legal-hoops/

by Varcht • 12 years ago

27 64 12 years ago

rayiner6• 12 years ago

The result: thousands of customers in 11 cities watching broadcast TV -- the most popular channels on television -- at a fraction of the subscription price of a cable or satellite package (monthly Aereo fees are as low as $8). But those customers are in jeopardy of losing their service.

This is the heart of the issue, isn't it? Aereo can provide this service for so cheap because it's using someone else's content for free. They don't themselves create or provide anything users actually want to buy--they just distribute the work of other people, and do so without compensating the people who created the products that are actually in demand.

I don't really buy Aereo's claim that somehow this implicates cloud computing. Lawyers and technologists can argue about how Aereo's array of individual antennas interacts with the public performance aspects of the Copyright Act, but I think ordinary users wouldn't view Aereo as a "cloud computing service" akin to Drop Box, but simply a website where they can stream TV shows for very cheap (ala Hulu).

nkozyra3• 12 years ago

The problem is that they're not sidestepping the law, and that the law intentionally makes it daunting and complicated to fulfill this purpose.

In other words, the law was designed to make such a prospect so unappealing that nobody would ever broach it. Now that someone has, well ...

harryh3• 12 years ago

The law wasn't designed to allow this. That's absurd. The laws were written before any of this was possible by people who didn't conceive of this sort of company.

evan_6• 12 years ago

Aereo can provide this service for so cheap because it's using someone else's content for free. They don't themselves create or provide anything users actually want to buy--they just distribute the work of other people, and do so without compensating the people who created the products that are actually in demand.

Imagine I pay Geek Squad, or some other handyman service, to come to my house and set up an antenna on my roof and hook it up to a DVR. I can't imagine anyone saying that either I or my handyman has done anything wrong.

What is Aereo doing that's different? The only difference is that the wire between the DVR and my television is longer.

its Rube Goldberg machinations are clearly just away to sidestep the law.

It would be a whole lot easier for everyone involved if they could just use ONE antenna. The whole Rube Goldberg machinations are to comply with the law.

rayiner6• 12 years ago

The only difference is that the wire between the DVR and my television is longer.

Hardly. The major difference is who owns and controls the equipment, and what other equipment they own and control. By your reasoning the only difference between inviting my friends over to watch a DVD and a movie theater is that the latter involves a bigger screen and more "friends." It's the kind of reductionist argument that lawyers and engineers love but ring hollow in terms of common sense.

gamblor956• 12 years ago

The differences between your a Geek Squad-installed DVR and Aereo:

- The GS DVR actually, physically exists and can be owned by the user. The Aereo DVR is a software service product (i.e., a SaaS, which cannot be owned).

- The antenna you own can be controlled by you--you can change its position, fix its location, or uninstall it. You cannot control the Aereo antenna, nor do you own it.

- The GS DVR connects to its source(s) and display directly. The Aereo DVR connects to its source over a multitude of cables and intervening hardware, and connects to the user's display over the internet, passing through numerous routers, switches, and hubs along the way.

- The data received over your antenna is unique to the specific reception qualities of your antenna. The Aereo antenna in your proposed single-antenna solution yields a common data stream. (This is the key legal turning point of the lawsuit.)

icebraining• 12 years ago

My ISP doesn't create anything that I want to buy either, it just distributes the work of other people (e.g. Google, Netflix, etc) without compensating them. Are ISPs running on an unethical business model?

Aereo is just an ISP for the airwaves instead of the Internet - it carries content that people have the right to access for them, and gets paid for that.

cujo2• 12 years ago

How is it different than paying your cable company to watch local channels over the wire? You can't watch "premium" cable channels. It's just the stuff you'd pick up with an OTA antenna, commercials included.

The real benefit of aereo is that it's all web based, so no one is tethered to their tv to watch.

bri3d• 12 years ago

Your cable company pays the local channels in most cases; look up "Retransmission Consent Agreement." Aereo are specifically avoiding negotiating these types of agreement.

acjohnson556• 12 years ago

The content creators aren't compensated when you put rabbit ears on your TV either. They have to make their money sidechannel via advertising. Aereo provides more eyes for that advertising, so you really can't accurately say that the network isn't compensated. They're compensated the exact same way as any other OTA broadcast.

There's one important thing you're not adequately accounting for that makes this situation difficult to analogize. The deal that gives broadcasters access to the airwaves also specifies that customers be able to freely tune into over-the-air programming. As they said in the article, there are a lot of people who don't even live in a place where they can access the digital broadcasts due to coverage issues. Many people in apartments are not allowed to install aerial antennas that might also allow them to access the OTA signals. Aereo helps provide such people with a cheaper way to access the content they are entitled to than cable.

I think there's absolutely nothing wrong with what Aereo's doing. The elephant in the room is that if it gets ruled legal, the floodgates will be opened for cable companies to do the same, and the retransmission scheme will be in peril. My opinion is that Aereo shouldn't be punished for what these other companies might do.

crazygringo• 12 years ago

because it's using someone else's content for free

Um, the TV channels are already broadcasting their content for free. You know that, right?

They don't themselves create or provide anything users actually want to buy

They're no different from an antenna and DVR of your own. You buy those, or you buy Aereo -- same thing. Both cases distribute the signal. You're not complaining that people shouldn't be able to buy their own antennas because the antennas don't "create anything", are you?

do so without compensating the people

You do realize that broadcast TV comes with commercials, no? The channels have been compensated for decades this way, and it's not like Aereo is stripping out the commercials.

6cxs2hd6• 12 years ago

On the other hand, the article implies that the broadcasters are not very good at... broadcasting. A big challenge for Aereo was finding a location that gets all the signals:

"It's striking to me," Lipowski said, describing missing signals at many places around the city, no more than a few miles from the current broadcast center on the Empire State Building. "You would not get the channels that the FCC said you should be able to receive. ... It was just gone, you could no longer receive television signals, you had to do something different. That's not fair."

Some Aereo customers use it because they can't receive signals from the broadcasters. The broadcasters seem to feel that these customers shouldn't use Aereo. Instead, the customers should pay ComastTimeWarnerMegaCorp, who can then pay the broadcasters.

i.e. Not only do the broadcasters not want to spend money improving their infrastructure -- they want to get money for not broadcasting well.

The sense of lazy entitlement among broadcast and cable operators is pretty stunning.

gtCameron2• 12 years ago

Reading that makes me wonder how they actually make any money. $8 a month per subscriber seems pretty low for the hardware and bandwidth involved per stream.

Even if you count on only a certain percentage of people watching at any given time you need to account for the high volume events where 80% of your customer base would be watching the Super Bowl for example.

The more I think about it the more it seems like the company's purpose is more about forcing this court case than actually building a sustainable business.

rtkwe• 12 years ago

Haven't you heard? Companies don't have to make money anymore, just have to keep climbing the evaluation ladder until they get acquired by a company with a big enough purse to bail out.

willu• 12 years ago

I've wondered this as well. The market seems really limited - people who are savvy enough to know about/use Aereo but are content with occasionally watching just a handful of broadcast networks...who aren't really producing the shows savvy people are buzzing about these days. Aereo's legal bills must be insane and the infrastructure looks expensive since everything is custom. Even if they win in the courts, what additional doors does that open up? It's not like cable networks will suddenly want to get in bed with them.

evan_6• 12 years ago

They say "subject to capacity" all over their site so I have a feeling if everyone in town is trying to watch the Super Bowl some people aren't going to be able to.

I have a feeling they're hoping that long-term they'll be able to ditch the one-antenna-per-stream nonsense. With that one tiny (!) little tweak it suddenly becomes wildly profitable.

rayiner6• 12 years ago

I have a feeling they're hoping that long-term they'll be able to ditch the one-antenna-per-stream nonsense. With that one tiny (!) little tweak it suddenly becomes wildly profitable.

For a short time, maybe. But such a court ruling would basically declare open season on broadcast content, such that anybody would be able to quickly start an Aereo competitor and retransmit OTA television. With AWS, it would be a cinch. So the price of the service would quickly drop to nothing.

acjohnson556• 12 years ago

It's already established that without one-antenna-per-stream, it is considered a public performance of copyright content, and therefore the content must be licensed. This is how it works with the cable TV providers.

rasz_pl3• 12 years ago

$8 a month per subscriber seems pretty low for the hardware and bandwidth involved per stream.

USB DVB-T dongle is $7 with free shipping. So they simply CANT spend more on hardware when it is that cheap with cots parts.

gtCameron2• 12 years ago

Thats less than half of the equation. They still have to get the signal to a transcoder, transcode the stream, store it on a "personal DVR" for each customer, and then stream it to you.

morganw2• 12 years ago

Areo offers service to people in radio shadows.

ForHackernews2• 12 years ago

I still don't really understand the point of Aereo. Are there people who have high-speed internet (i.e. not in remote areas) but who can't just put up an antenna?

The only reason I can imagine is international viewers who want to watch US broadcast TV.

what_ever• 12 years ago

I live in an apartment complex in US which doesn't allow setting up my own antenna.

javanix• 12 years ago

Even if I wanted to put up an antenna, certain spots are just not going to get reception easily for all of the channels I want to watch.

cujo2• 12 years ago

1 - People who don't have a TV but don't mind watching the occasional show on their computer

2 - People who rent so can't put up antenna and get lousy reception on the indoor types

3 - People who just get crappy antenna reception

I find it fascinating that so many people are confused about Aereo. Many of these people pay their cable provider for the privilege of watching local stations over the wire. It's basically the same service, only you're not tethered to a television to watch.

Yhippa• 12 years ago

I have TiVo Product Lifetime Service and built my own antenna but would love Aereo because of #3. I live in an area where it's difficult to get good reception and this would solve a huge problem if I could get the local stations reliably.

revscat• 12 years ago

I have Aereo because I cannot get a clear broadcast signal.

joezydeco3• 12 years ago

At the moment Aereo locks you into the metropolitan region specified by the billing address on your credit card. So if your card has a Denver address, you can only see Denver channels.

So this would not be a usable solution for international viewers. Perhaps in the future if things loosen up.

chrisoverzero3• 12 years ago

You have to be physically located in the market whose content you wish to receive. Sending NYC broadcast television to anywhere but NYC is not in Aereo's business model, and they actively attempt to prevent doing so. If they were caught doing it, they'd be shut down without a question.

ForHackernews2• 12 years ago

Wow, that makes it even less valuable than I realized. Thanks to digital broadcasting, I get a perfectly clear picture with a $10 rabbit ear antenna from a thrift store.

How does Aereo charge $8/month for this?

morganw2• 12 years ago

Just because you're in a market doesn't mean you can actually receive broadcast TV. I need a 100 foot mast to see over a nearby mountain to broadcasters that neighbors 2 miles away can get with rabbit ears. Aereo's NYC region goes out to the tip of Long Island https://aereo.com/coverage/nyc

kd0amg• 12 years ago

Are there people who have high-speed internet (i.e. not in remote areas)

How does this equivalence work? Last place I lived wasn't exactly a major city, but there was still cable internet available. Sitting at the bottom of a valley meant no OTA service.

harryh3• 12 years ago

Here's my question: why do the TV networks still broadcast over the air? If they weren't doing that none of what Aereo is doing would be possible.

Do they really make that much money from showing commercials to people with rabbit ears? Maybe I live in a bubble but everyone I know that watches TV gets cable or somehow watches over the internet.

rm445• 12 years ago

Yeah, it's a shame really because American reliance on cable distorts the technology market: at least part of the reason that tablets and phones don't already have TV tuners in them has to be that one of the biggest markets isn't interested.

acjohnson556• 12 years ago

In 1996, 58.4% of American households had cable [1], but 96.7% of American households have at least one TV. Assuming that this difference is made up mostly of people watching OTA TV (not satellite TV, fiber, other, or non TV watchers), that still leaves a pretty massive audience. I wish I had numbers, but my understanding is that retransmission fees are currently not the majority of income for broadcasters. Certainly, they are quite significant and growing, though.

[1] https://en.wikipedia.org/wiki/Cable_television_in_the_United...

[2] https://en.wikipedia.org/wiki/Television_in_the_United_State...

maxerickson2• 12 years ago

Dish and Direct TV have about 34 million subscribers between them.

That's nearly 30% of U.S. households (something like 117 million households).

harryh3• 12 years ago

Presumably that 58.4% has gone up some in the last 18 years?

rasz_pl3• 12 years ago

  "drove to a Home Depot and bought those PVC pipes that ordinarily the cheap terrorists would use for making explosive"

Wow, Chet Kanojia, founder and chief executive of the TV-streaming company is really ...stupid?

efnx• 12 years ago

While reading this I could stop thinking how wasteful it all seems. Here we are creating a complicated solution to a very simple problem. All the workarounds needed to navigate around copyrights violations is costly - for the earth! If Aereo could just record it once and distribute it out we'd be saving energy. Broadcast companies can just let them build it out and then buy the idea and make a nice press release about improved service.

Inside the tech aiming Aereo through TV's legal hoops

Related Stories