Aereo's rent-an-antenna service lost in court. But if the TV business keeps treating customers as adversaries, it will eventually lose too
Yesterday at the Supreme Court, the great American dream of renting a tiny antenna in a closet somewhere so you could more easily watch The Biggest Loser live on your phone died. The court ruled 6-3 that Aereo, a business dedicated to streaming over-air TV signals online to subscribers, was ripping off broadcast networks by taking a free product and selling it like bottled tap water from a public drinking fountain. The Aereo Speedwagon got a flat tire.
I’m not a lawyer. I don’t even like that many legal dramas. So I can only assume that SCOTUS is correct in saying that Aereo’s system was a cheat. Fair enough. And I cover TV closely enough to know that it costs a lot of money to make. Broadcasters saw Aereo taking their signal and selling access to it without giving them a dime; they would be stupid not to try to quash that. Also fair enough.
But if broadcast TV–and the larger TV industry–is a healthy business, it shouldn’t look at the Aereo case as a thumbs-up to continue the status quo. A healthy business would ask: What did customers want from Aereo? And why aren’t we just giving–or selling–that thing to them ourselves?
In simplest terms, Aereo customers wanted a way of getting “free” (scare quotes since they paid Aereo and because nothing is truly free), live broadcast TV without paying hundreds of dollars a year for cable. Yes, they could do this with a digital antenna hooked to a TV, a computer or a DVR, but in practice not everyone can get quality reception. In any case, wanting to get over-air TV without having to pay cable for the privilege is not an outlandish demand; it’s something you’re supposed to be able to do in exchange for broadcasters using public airwaves for free. Aereo users also liked being able to stream that TV to mobile devices–live, not after a day or a week on Hulu–which is not a condition of the networks’ getting public spectrum but should not outrage networks, for whom the more viewers the better.
Did anyone really need that? Maybe not! Maybe Aereo was a stupid product. (I was not a subscriber.) Maybe a devoted consumer could replicate its effects with various workarounds, and maybe a sane consumer could just live without it. So what? Since when is the industry that is bringing you the 16th season of Big Brother not in the business of giving people stupid things they want? Particularly if they’ll pay for it?
One answer is that, while the networks have to technically be in the business of broadcasting for free, in practice they now depend on a system where most people get their signal from cable operators, which collectively pay several billion a year in “retransmission” fees. If Aereo’s methods were legal, cable companies would probably mimic them. And cord-cutting–going without a cable subscription–is a greater threat to cable companies, but the networks also have little incentive to upset this system by making it much easier for penny-pinching couch potatoes to do.
This situation is not all the broadcast networks’ fault by a long shot. There is a complex network of media companies–many owned by the same conglomerates–who are invested in the $200/month big cable bundle: broadcasters, cable channels, premium channels, studios, cable and satellite carriers. Their interests often conflict–as you noticed if CBS disappeared from your cable screen in the middle of the US Open–but for complex, intersecting reasons, they generally owe allegiance to the existing business model of The Big Bundle.
Which means that the larger TV business ends up treating its consumers like adversaries. There are far more options for TV watchers than a decade ago, yet not as many as there could be. You can watch, say, the Olympics on your iPad–but you have to prove you have a cable subscription, even if your cable company doesn’t provide the Internet bandwidth you’re using. You can stream many shows eventually, but you can’t stream much live TV legally for any price. You can choose from a few cable packages, but they all involve subsidizing plenty of channels you’ll never watch. If a certain choice would threaten The Bundle, the answer is: Nope. You don’t really want that. Besides, what else are you going to do?
Well, whatever. Business isn’t a popularity contest, right? And it’s possible to base a successful industry on limiting options and trusting your customers have little other choice–ask the airlines! Of course, Elon Musk’s supersonic tubes are not going to become a practical alternative to air travel any time soon. And maybe TV can manage its own way for a long while yet. But even with the restrictions that the current system sets up, a not-insignificant number of would-be cable subscribers are saying, eh, maybe Netflix isn’t the same, but it’s good enough. I’m not going to argue that TV and cable companies have an ethical obligation here–because LOL–but they may have a long-term interest that they’re sacrificing in the name of squeezing ever more out of The Bundle for now.
But changing our media options isn’t just about demanding things from the bad old corporations. Consumers have an obligation here too: to recognize that TV doesn’t appear in front of your eyeballs like magic. If the current business model gives way to a more a la carte one, that doesn’t mean it will be cheap. A legal Aereo-like service would likely cost more than Aereo charged. Picking and choosing to subscribe to a few channels–without the group subsidy from the Bundle–will probably cost much more than most people assume, and depending what you choose, could cost more than The Bundle.
Media choice, in other words, isn’t magic, but it’s also not something consumers need to be protected from. Every “problem” that technology creates for TV companies–startups like Aereo, people sharing HBO GO logins–is also a sign that people love TV. Why not show those TV lovers a little love too?