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Aereo mobile TV service could be illegal says NAB, broadcast networks

As NYC streaming service Aereo (with heavyweight investors such as Barry Diller on board) rolls toward its March 14, 2012, NYC debut, the brakes have hit with lawsuits from PBS, FOX and Univision, as well as a terse statement from NAB. The service is a way for consumers to receive streaming channels, along with DVR functionality, via small antennas. It offers all the local HD networks including NBC, FOX, ABC, CW, CBS and PBS. For $12 a month, users can stream to their web browsers as well as their iOS, Android or Kindle Fire devices. The service is set up similar to a mini cable-TV system, offering a package of channels for one low monthly cost. NAB is not amused. It offered the following statement this week:

"NAB strongly supports legal action against Aereo. Copyright and TV signal protections promote a robust local broadcasting system that serves tens of millions of Americans every day with high-quality news, entertainment, sports and emergency weather information. A plaintiffs' win in this case will ensure the continued availability of this programming to the viewing public."

The rub is how the Aereo service works, which to put it simply, is taking OTA stations, converting the signal and then retransmitting it via streaming to mobile devices. It conveniently sidesteps cable TV and loosens the grip many cities have with one cable carrier in their area. Aereo claims it is within its legal rights, because the service does include an antenna (actually a unit with many mini antennas inside), and it is just grouping the channels in a more convenient form for the consumer. Aereo says it is within the bounds of public exhibition laws, but the lawsuit against the service claims it is wide-scale copyright infringement.

Also worth noting is the service can potentially erode high-level contracts that major networks have with cable operators, since it’s unlikely the channels are seeing much profit from the creative repurposing of content that Aereo is providing. We’ll see how it all plays out as Aereo moves closer to its launch date in NYC.