Rich Warren: The next little — or big — thing in broadcasting

When you open your cable or satellite bill, you'll see new surcharges for viewing our local TV stations. Cable companies must pay increasingly larger fees to carry local programming. Strangely, you pay no charge by simply plugging an antenna into your TV. Other than enduring commercials (which you must suffer through on cable as well), the signal arrives absolutely free.

Now, a little company in New York City threatens the future of free TV.

Aereo provides a revolutionary service that so outrages broadcasters many are threatening to turn off their transmitters and supply programming only via cable. To abide by copyright laws (or in the broadcasters' view, circumvent copyright laws), Aereo erected an antenna farm with a dedicated antenna for each subscriber it serves. You pay a subscription fee to lease one antenna to view broadcast TV on any digital device, as long as you remain within the coverage area of the broadcast stations. Aereo also includes a digital video recorder service. It costs $1 a day, $8 a month or $80 a year, with a slightly more expensive premium for extra hours of DVR recording.

On a theoretical level, there's little difference from Aereo if you put an antenna on your roof, connect a splitter to it and share it with neighbors for a small fee. Of course, you might open your door some morning to find burly representatives from our local stations slapping baseball bats against their palms.

New York broadcasters reacted the same way by going to court. Thus far, they have lost twice in trying immediately to put Aereo out of business. In mid-April the broadcasters filed another appeal claiming that Aereo "threatens to cause massive disruption to the television industry, and will adversely impact the public's access to the quality and diversity of programming."

Incidentally, PBS hopped on the commercial broadcasters' bandwagon. Since PBS is largely publically supported via the Corporation for Public Broadcasting and viewer donations, that's chutzpah.

Aereo soon will arrive in Chicago and a handful of other major markets. Thus, the broadcasters are in a frenzy for a rapid decision by the appeals court. This kind of case could escalate all the way to the Supreme Court.

At the same time, the cable companies easily can, and do, offer much of the same service: allowing viewers to watch their local stations on their digital devices, such as smartphones and tablets. Of course, that requires viewers to buy a cable package that costs much more than $8 a month.

If Aereo survives, it will be quite a while before it reaches a market as small as East Central Illinois. If it does come here, it will be difficult to determine the "local" market, since some stations serve western Indiana while others serve Charleston, Springfield and Bloomington.

Interestingly, you must "promise" Aereo that you're using its service within the market where you live. Theoretically, you can't live in the Bronx and view NYC programming in Kansas City. However, there is a back-door override where after Aereo detects you're using the Wi-Fi at the Holiday Inn in Kansas City you can lie and swear you're at home in order to view your home programming for a limited time.

Will broadcasters fulfill their bluff and unplug their transmitters? That's highly unlikely. The government would rejoice if TV broadcasters decided to go cable only. Then the feds could auction off the entire TV broadcast band to the cellphone companies and pay off a nice chunk of the deficit.

It would seem that the more eyeballs watching, the better for the advertisers who pay for broadcasting. People already use cable company-provided DVRs, TiVo and PCs to skip the commercials, so Aereo is nothing new in that category. To me, there is little difference between plugging a USB TV tuner into my PC or paying Aereo to watch TV on my PC.



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