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Aereo Is So Desperate It's Turning To Congress For Help

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In what may be its final gasp, the streaming TV service Aereo urged customers Tuesday to lobby Congress and protest a Supreme Court ruling that dealt a crippling blow to the company’s business model.

In a letter to subscribers, Aereo CEO Chet Kanojia directed them to the company’s website, ProtectMyAntenna.org, where they can find out which elected officials to send tweets, emails and Facebook messages to.

“Tell your lawmakers how disappointed you are that the nation's highest court issued a decision that could deny you the right to use the antenna of your choice to access live over-the-air broadcast television,” Kanojia wrote.

The Supreme Court ruled Wednesday that Aereo was violating copyright law by streaming broadcast TV signals to subscribers without paying for them. The 2-year-old company used tiny antennas to capture broadcast airwaves and stream those signals to users who paid about $8 a month for the service. It offered a handful of network TV offerings in about a dozen cities, and subscribers could watch and record the programming on their computers and mobile devices.

Aereo said Saturday it was temporarily suspending its operations after the ruling “as we consult with the court and map out our next steps.”

It’s unclear how effective Aereo’s new lobbying effort will be. The company has not disclosed how many customers it has. And the National Association of Broadcasters, a trade group that represents broadcasters (many of whom defeated Aereo in court), has given sizable contributions over the years to both Republicans and Democrats in Congress, according to the Sunlight Foundation.

Rich Greenfield, a media and technology analyst at the research firm BTIG, said Aereo is likely pushing Congress to amend the Copyright Act to allow consumers to use a cloud-based antenna to watch broadcast TV, but the chances of that happening appear slim.

“I can only presume they want a law change, which is not an easy thing to do in this country,” Greenfield said.

If Aereo is going to survive, its likely path will be to follow the cable industry's model and start paying fees to broadcasters for the right to rebroadcast their signals to subscribers, Greenfield said.

“Based on the Supreme Court ruling, that’s the only unsettled question we need to learn more about -- whether Internet companies can now become cable companies,” Greenfield said. “That may be a different business than what [Aereo] was in.”

Aereo argued it didn't need to pay those fees because the broadcast signals -- which it captured and retransmitted to its subscribers via the Internet -- are free. Kanojia has said he had “no Plan B” if Aereo lost in court, suggesting he would not be interested in changing the company's business model to pay fees to broadcasters.

"If we don’t succeed in that despite our best efforts, good law on our side, and the merits of our case, it will be a tragedy but it is what it is,” Kanojia told Bloomberg TV in March.

 
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