With Aereo planning to expand its service to Washington and 21 other markets this summer, CBS, ABC and other big networks have attacked the upstart company with renewed vigor.
In lawsuits, they argued Aereo is little more than a content thief. But their efforts to persuade federal courts to shut it down have failed. On Monday, Fox Television’s parent company fired back, saying it might consider delivering its shows only through cable connections, no longer broadcasting them.
“We won’t just sit idle and allow our content to be actively stolen,” said Chase Carey, president of News Corp., which owns Fox Television.
The battle over Aereo, which was founded barely two years ago, underscores the television giants’ growing fears of the disruptive force of Internet video. With Web connections fast enough to deliver high-quality picture and sound, the cable and television industries’ long hold on the living room is loosening, with weighty implications for the way programming is created and distributed.
Faced with cable bills that typically reach well over $100 a month, 5 million households have abandoned cable, up from 2 million in 2007, in favor of much cheaper Web-based options, according to Nielsen. Netflix, for instance, offers an array of movies and TV shows to those with an Internet connection for a subscription of less than $10 a month. Through Apple and Amazon.com, consumers can pay a few dollars for each show they view.
As these alternatives have grown in popularity, the traditional model of television — which has long financed the creation of shows and padded the profits of cable companies that distribute programs — has trembled. But it has been able to hold its ground as the only source for the latest shows and live sports.
Aereo offers all of the programming that appears on CBS, NBC, Fox, ABC, PBS and about two dozen other channels. Customers could see NCAA tournament games live or the most recent episodes of “American Idol” or “Dancing With the Stars.”
Such shows are also freely available to consumers who use antennas to get their television. About 54 million people still watch over-the-air broadcast television.
But on top of that content, Aereo also allows for pausing live TV or recording shows and saving them for later — features once exclusive to subscribers of cable or satellite services. The company eventually envisions allowing consumers to pay for only what they watch, similar to ordering food items off an a la carte menu.
“All we are doing is giving consumers an alternative to what is now an utterly irrational system where people have to pay too much for so many channels,” Aereo chief executive Chet Kanojia said in an interview Monday at The Washington Post.