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I agree more often than not with BTIG analyst Rich Greenfield’s industry insights. So I’m surprised to see how impressed he is today with a new product that strikes me as a likely loser: Aereo. The company, backed in part by Barry Diller, just announced that it will go live in New York City on March 14. Residents willing to pay $12 a month will be able to stream signals from local over-the-air TV channels, and watch their shows on demand with the functionality of a 40-hour, dual antenna DVR. The service will only work as long as users are in the local market — not, say, 
if they’re on a vacation or business trip. Aereo execs expect lots of people to subscribe, perhaps in conjunction with Netflix, as a substitute for the $65 a month cable or satellite TV package. That could be revolutionary, Greenfield writes today in a blog post: “If Aereo is in fact legal, we find it hard to fathom that the traditional (pay TV) bundle will survive and that retrans payments will continue to scale as broadcasters are expecting them to over the next several years.” If he’s right, then it’s the end of the media world as we know it. The giants make most of their profits from the fees they collect for their bundled channels. But Greenfield acknowledges that broadcasters likely will take Aereo to court for selling their services without paying retransmission consent fees. The company hopes to get around that by saying that it has tiny antennas for each customer — users effectively rent them to pick up the free, over-the-air signals that they can receive at home. (That case would be similar to the one that Cablevision successfully made on behalf of its remote storage DVR.) Assuming that Aereo is legal, then you have to wonder: Most people who watch videos on their smartphones or tablets only like to watch for a few minutes, about the length of a typical YouTube clips. How many people will consider it a bargain to pay $144 a year to run their batteries down watching free TV — even with DVR capabilities?
Will $12 Monthly Stream Service For Free TV Alter Media Landscape?
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I like the slingbox because it lets me watch my cable box/dvr from the other side of the world
Thanks for the advertisement.
$144 a year is free!!!
Given current tech it’s absurd that the Cable and Satellite companies refuse to deliver a la carte subs. I get that new and underseen netwworks deserve some facetime with unsold consumers but the pricing relative to actual use and value is insulting.
Unless i misread something, it’s only dealing with the over-the-air channels. Theres like only 10 of those channels and their quality is terrible.
They won’t just watch on their phones; they’ll stream it to a TV monitor.
Aereo and Netflix streaming, together, would give a viewer access to a great deal of what they already watch — add in website that make full episodes of other shows available, and it gets even better. Especially once someone steps up with a system to coordinate it all.
The end result wouldn’t be $144/year extra, but $144/year (plus the cost of Netflix) instead of that cable bill.
It won’t happen exactly that way — there’ll be other revolutions and adjustments and such — but TV, like so many other things, will move to the internet. How it’ll happen remains to be seen, but this sort of development will be the sort of thing that forces an adjustment, rather than assuming the status quo will continue because most people won’t want to watch stuff the new way.
Some people will like the new way. And “some” has a habit of growing into “most,” at it becomes convenient and cheaper than the alternatives.
This is so clearly retransmission, I can’t even imagine why they are bothering — unless they intend to pony up and pay.
This “one antenna per user” dodge is not going to impress the courts and the precedent in the Cablevision remote DVR case is not going to help them — all that content was licensed.
Assuming geographic location and antenna reception, I don´t see why New Yorkers wouldn´t just buy an antenna, a TV tuner, and a hookup to their computer and do the same for free after the initial buy in.
Antenna: $15-30
Computer: $0 (if already owned)
USB TV Tuner: $80-100
Software to dvr, stream, etc: $0 (Microsoft, MythTv, XBMC, Orb, etc)
So, total buy in should be around $130. You could have additional costs like a computer upgrade or more storage, but those are likely costs you would probably incur anyways. Best of all, the service is unquestionably legal and you can expand it however you see fit.
Admittedly, it´s more complicated but a few youtube videos but the average user should be able to figure it out. Plus it´s a one-time buy instead of a subscription service.
At least here in Manhattan, there is little to no reception with an antenna.
How Tiny are the antennas?
It all depends on what channels you have in your local market. I have twenty-five channels in my market, the Dallas-Fort Worth metroplex. It’s probably going to cause court battles, as well as worn down cellphones. I don’t think it’s a bargain at any price. That’s money that you could spend on your electric bill, if you watch that much television.
“How many people will consider it a bargain to pay $144 a year to run their batteries down watching free TV — even with DVR capabilities?”
Everybody.
TV is dead, 5 years from now everyone will have a device to watch “TV” as we know it now. The technology is there now, its the big media companies that is dragging their heels. What else is new.