After Aereo, what's next for Internet TV?

Published on NewsOK Modified: June 26, 2014 at 5:30 pm •  Published: June 26, 2014
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Mohu has sold 1.5 million antennas since it began in 2011 and they work in the kind of dense urban areas like New York where Aereo is believed to have had a small subscriber base. It is about to launch Mohu Channels, a device that blends Internet video services like Netflix with free-to-air TV in a single channel guide.

"We certainly do see and believe that the cord-cutting movement is on the rise," he said.

Alki David, the CEO of online streaming company FilmOn, said the Supreme Court's ruling actually creates an opportunity for startups because the court said that Aereo bears an "overwhelming likeness" to cable companies.

According to David, that means online video companies can compel broadcasters to license their TV signals under the "retransmission consent" rules outlined in the 1976 Copyright Act.

That could help online video companies create small broadcast-channel only bundles for consumers rather than 100-plus channel packages from traditional pay TV operators that cost more than what some consumers are willing to pay.

"This might be the undoing of the bundling system," David said. "The only compulsory license we're after are the four or five local channels in the city we're in. Of course it would be great. What else can it mean?"

But it's not like the pay TV industry is standing still.

Satellite TV company Dish Network Corp. said it's preparing to launch an online TV service with channels like ESPN, ABC, Disney Channel and others for about $20 to $30 a month before the end of the year. The target audience is young urban professionals who don't want to watch more than 20 or 30 channels.

Since last year, Comcast Corp. has offered a slimmed down package combining Internet service, a little more than 10 local TV channels and HBO for $40 a month for 12 months. That's just $10 more than getting the Internet alone.

Niemeyer says the incremental $10 charge for broadcast TV and HBO seems like a very Aereo-like offering, especially because the HBO GO app allows for online viewing, and having a pay TV subscription will allow customers to sign in to different online offerings by networks.

"It's something they wouldn't have done five years ago, but they're doing it," he said. "I think they're trying to think long-term about how to still be a big-dollar business. It means they have to change. They have to change on channel bundling, how they deliver services to people, using what pipes and how."