Online TV service Aereo continues its nationwide expansion on Tuesday by launching an app on Android devices, shrugging off opposition from networks including Fox, CBS, NBC and ABC, which appealed to the U.S. Supreme Court to shut down the service.
Aereo retransmits a network TV signal onto a wireless device or computer, and for $8 per month users can watch or record programs. The $8 subscription comes with 20 hours of recording time while for $12 per month users can access 60 hours. The online TV service has only been available on mobile devices using Apple's iOS operating system. That now changes with the launch of the Android app on Tuesday.
Broadcasters have been irate at the service since it first launched in New York City in 2012, because Aereo pays no retransmission fees for using the signals, which violates copyright law, according to FOX, CBS and ABC. Broadcasters may collect more than $6 billion in retransmission fees by 2018, estimates SNL Kagan market research firm. Aereo pays nothing and places that business model at risk, so networks have sought injunctions from numerous courts requesting the service be shut down, failing each time.
Networks petitioned the U.S. Supreme Court on Oct.11, appealing a July decision by the Second Circuit Court of Appeals in New York that refused to shut down the online TV service.
"Aereo offers precisely the kind of service Congress sought to prohibit when it revised the Copyright Act to define 'public performance' to include retransmissions of over-the-air broadcast transmissions to the public," the broadcasters said in their appeal to the Supreme Court. "The Second Circuit nevertheless endorsed Aereo's business model, holding that Aereo's retransmission of over-the-air television broadcasts to its paid subscribers is not a public performance because each Aereo subscriber receives an individualized transmission streamed from an individual subscriber-associated digital copy of the broadcast transmission."
Aereo "will respond, as appropriate, in due course," to the appeal at the Supreme Court, says Virginia Lam, spokesperson for Aereo. The online TV service is live in New York City, Boston, Atlanta, Miami, Salt Lake City, Houston and Dallas, and the company plans to expand to more cities including Detroit and Washington, D.C..
"Since we are a private company, we do not disclose member numbers," Lam says. "Anecdotally, interest and uptake has been remarkably strong across all markets. We expect to see additional growth as we add new device compatibility."
The Supreme Court will decide whether to accept the appeal, but the chances are not good, says David Kaut, a media analyst at Stifel Nicholaus market research firm. However, broadcasters have earned favorable rulings in lawsuits against online TV services FilmOn X and Aereokiller, Kaut added.
"It's difficult to get preliminary injunctions heard by the Supreme Court," Kaut says. "They generally don't take these types of cases, and they would rather the lower courts work through it."
Retransmitting TV signals onto wireless devices has the potential to disrupt the TV market on a scale comparable to that which the music industry suffered with the advent of software that allowed people to "rip" copies of songs using their computers, says Mike McGuire, a media analyst at Gartner technology research firm. This could lead to new government regulation of broadcast retransmissions or could embolden paid TV providers to push back against broadcasters' retransmission fee business model, McGuire says.
"This is the latest example where consumer adoptions of new tech continually outpacing media law and established business models," McGuire says. "An increasing number of people are paying for increased convenience to access television outside of a television."