Aereo founder and Chief Executive Chet Kanojia has a message to the broadcasters trying to shut his service down: Let's be friends.
Speaking at the Citi 2014 Global Internet, Media and Telecommunications conference in Las Vegas on Wednesday, Kanojia tried to make the case that Aereo, which distributes the over-the-air signals of local TV stations to consumers via the Internet, is a blessing rather than a threat to big media.
"I think Aereo is excellent for broadcasters and will continue to add value to them," he said.
Kanojia said Aereo will appeal to people who don't want to pay hundreds of dollars for big pay-TV packages and hence will help broadcasters from losing viewers to cord-cutting.
Broadcasters beg to differ and have asked the Supreme Court to shut down Aereo on the grounds that it violates their copyrights. Last year, the U.S. 2nd Circuit Court of Appeals in New York found that Aereo's transmissions and recordings of broadcast content are not "public performances" of copyrighted material.
Launched in 2012 and available in 10 markets, Aereo charges its subscribers $8 to $12 a month for the service, which includes a small antenna to receive the signals and access to a cloud-based digital video recorder that holds as much as 60 hours of programming.
Besides charging that Aereo is transmitting their content without authorization, broadcasters also fear that the service could ultimately undermine the revenue they get in so-called retransmission consent fees from cable and satellite services to carry their channels.
Kanojia said that's unlikely. He noted that CBS, NBC, ABC and Fox are all part of larger media companies that own popular cable channels that they can use to leverage fees for their broadcast channels.
He noted that ABC parent Walt Disney Co. owns ESPN and that it is unrealistic to think a pay-TV distributor is not going to be able to say to ABC, "I'm not going to pay your retransmission consent fees but I want ESPN."
As for the idea that pay-TV distributors would want to get in bed with Aereo to help with their negotaitions with broadcasters, Kanojia said that has little appeal to him.
"We're not interested in helping people fight another battle on retrans," he said.
Asked why broadcasters are trying to shut him down, Kanojia said, "The history of this industry is driven by control."
He added: "The playbook is litigate. If you fail, try to find a legislative fix. If you fail with that, then try to figure out how to make a business out of it, and they've made tens of billions of dollars doing that in the past, and I think they will likely be very successful working with us in the future as well."
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