Aereo may find itself out of business if it manages to convince the Supreme Court next week that its business plan is legal and not a theft of service.
Aereo uses thousands of tiny antennas placed in areas where over-the-air broadcasts can be received. The company then uploads the television broadcast programming to DVRs stored in data centers from where individuals can stream the programming at their convenience to a TV or mobile device.
There is a report that at least one broadcaster is considering beating Aereo to the punch and rolling out a similar service. Supposedly CBS's Plan B in case Aereo wins is to quickly create a subscription-based service for its on-demand and over-the-air programming. Another option for CBS would be to simply halt all its free over-the-air broadcasts and become a cable or Internet network.
A "person familiar with the situation said CBS has the ability to launch a service that would stream its programming over the Web simultaneously with its television broadcasts. CBS would charge a few dollars a month and show ads, the person said. Such a service would also likely offer on-demand programming. It could include Showtime, the CBS-owned premium cable channel, which would increase the subscription fee, the person said. CBS would use technology company Syncbak, in which it owns a minority stake, to power streaming of local TV stations' signals over the Web," the person said.
None of the other broadcasters involved have come forward with their plan in case the legal action goes against them. Aereo has already said it does not have a back-up plan in case it loses. However, the company has a long list of heavy hitters who have filed amicus briefs in favor of Aereo in the case.
The Supreme Court will hear the case Aereo Vs. ABC on April 22. The court will have to decide if Aereo is legally obligated to pay broadcasters for the programming it snatches from over-the-air signals, which is then sold to its own subscribers.
The major networks claim that Aereo's business model is tantamount to stealing and if the Supreme Court finds in favor of Aereo, then they will be put out of business as cable and satellite operations in the United States start similar services. This would negate the need to pay the broadcasters for some of their programming. In addition, the broadcasters said they believe the action is in violation of the Copyright Act of 1976.
