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You are here: MacNN Forums > News > Tech News > Streaming TV service Aereo files for Chapter 11 bankruptcy

Streaming TV service Aereo files for Chapter 11 bankruptcy
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Nov 21, 2014, 11:09 AM
Aereo has filed for Chapter 11 bankruptcy protection, following the high-profile shutdown of the service via a ruling from a New York court. The cloud-based TV rebroadcasting and DVR service made the filing just under two weeks after it was forced to lay off a large number of employees at its Boston New York offices, with little chance of resurrection.

The company famously lost its US Supreme Court battle against broadcasters in June of this year. Aereo recorded broadcasts on hundreds and thousands of miniature antennas, with each recording unique to each subscriber in an attempt to get around copyright laws. The court found in favor of the broadcasters, and though Aereo attempted to keep itself alive by claiming it was effectively a cable operator and should be able to pay relatively low licensing fees to broadcasters, the US Copyright Office denied Aereo's claim, and the Court of Appeals refused to reconsider the Supreme Court's verdict.

In a "letter to our customers" on the Aereo website, CEO Chet Kanojia writes proudly about the creation of the service. "We put our collective engineering power to work to create an online technology that was simple, useful, and compelling, and provided consumers with a true alternative to how they watch local live TV," writes Kanojia, "That's how Aereo came to life."

After expressing that the legal challenges "have proven difficult to overcome," Kanojia reveals the bankruptcy filing as "Chapter 11 reorganization proceedings," and that the company has appointed Lawton Bloom of Argus to work as Aereo's Chief Restructuring Officer. "Chapter 11 will permit Aereo to maximize the value of its business and assets without the extensive cost and distraction of defending drawn out litigation in several courts." Kanojia ends by thanking Aereo's customers for their support. "We are incredibly grateful to have gone on this journey together."
( Last edited by NewsPoster; Nov 21, 2014 at 12:47 PM. )
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Nov 21, 2014, 11:24 AM
For those who want to know, that image is of an Aereo antenna array.
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Nov 21, 2014, 02:50 PM
It's a shame the lost their case. They were up against power companies that convinced the court that the law didn't support Aereo's business practice. And technically they were right. I don't see why the networks are upset with this? Don't they want more viewers? The broadcast business model is to broadcast to everyone in a geographical area and pay for it with advertising. Aereo was enforcing geographical boundaries, so what's the problem?
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Nov 21, 2014, 03:13 PM
The problem was that Aereo was profiting off of the "free, advertiser-supported" broadcasts.

It's all well and good to receive an OTA broadcast and show it to whomever you like, but once you start redistributing that broadcast -- and, more importantly, start making money off of that activity -- you get into legal trouble. And rightfully so.

This isn't just a matter of a "technicality." This is a matter of Aereo running afoul of the law and inserting themselves in between the broadcaster and broadcast receiver and profiting off of that. If anything was simply a "technicalityy," it was Aereo's assertion that simply having a single antenna per subscriber made their entire operation legal. Aereo operated under a technical loophole for their entire existence.

It was definitely a "cool" and "useful" service, but that doesn't mean that it's legal nor that it should be allowed to continue to operate.

Note that this doesn't reflect my own personal opinion on Aereo's service (which I do believe to be quite useful and nifty) -- but when determining whether an activity is legal or illegal, one's own personal opinion about the service carries little, if any, weight -- and that's a good thing. You need to be able to not be blinded by what you want and look at the situation objectively -- and there's no way in hell anyone looking at Aereo's service in an objective light could possibly determine that it was legal.
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Nov 21, 2014, 03:51 PM
"there's no way in hell anyone looking at Aereo's service in an objective light could possibly determine that it was legal."

Oh I would disagree with that. They found a loophole for sure, but I thought they had a good argument. It wasn't completely ridiculous as you imply. Nevertheless, allowing Aereo to run with their business model surely would have wrecked the free-over-the-air TV paradigm, to the detriment of average people like you and me. The broadcasters would not have sat back and allowed things to remain status quo had Aereo won.
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Nov 22, 2014, 04:41 PM
Just because an argument is good doesn't mean it's grounded in lawfulness. Plenty of altruistic things are illegal, and most people that lived through the 80s knows that you don't go messing with broadcasts -- interrupting them, redirecting them, or charging a fee to display them.

There is virtually no way a company can insert inself into the broadcast stream, which originates at the broadcaster and ends at the viewer, without paying royalties to the broadcasters and/or the networks they broadcast, especially if that middle-man company intends on making a profit from doing that.

There are plenty of altruistic arguments for Aereo; unfortunately, there are virtually no legal arguments in their favor, no matter how badly one wants or wishes for their service to exist and be legal.
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