Aereo to Courts: Fine, We're a Cable Company

In this Wednesday, March 26, 2014 photo, Chet Kanojia, the founder and CEO of Aereo, speaks during an interview with The Associated Press, in New York. The future of Aereo, an online service that provides over-the-air TV channels, hinges on a battle with broadcasters that goes before the U.S. Supreme Court in late April 2014.

Image: Mark Lennihan/Associated Press

Aereo lost its case before the U.S. Supreme Court because a majority of the justices said its resemblance to a cable company meant it had violated copyright laws.

Now, Aereo agrees.

In a blog post published Wednesday night, the streaming television startup announced its next strategic step in an attempt to save its business, and avoid squandering nearly $100 million in investment. Aereo is now arguing that it should be considered a cable company, and granted a license that would allow it to pay licensing fees, and gain access to the broadcast content it had previously been pulling down from the airwaves.

The move marks a distinct departure from previous statements by the company. Investor Barry Diller said Aereo had no alternate plans if it lost in the Supreme Court, and company CEO Chet Kanojia said he did not see Aereo "buying wholesale content and retailing it to consumers."

"That doesn’t make sense in the long term," Kanojia had said.

Aereo's service allowed users to pay a monthly subscription fee to stream and record local broadcast channels. The Supreme Court found that Aereo violated copyright law by engaging in a "public performance," essentially declaring that the company's operations mirrored those of a cable company.

In a court filing Wednesday, Aereo said it is filing the necessary paperwork to receive its license, to which it is entitled if it is considered a cable company by the U.S. Copyright Office.

"If Aereo is a 'cable system' as that term is defined in the Copyright Act, it is eligible for a statutory license, and its transmission may not be enjoined (preliminarily or otherwise)," Aereo said in its court filing.

Aereo may run into some trouble with this line of reasoning. The Supreme Court declared it to be similar to a cable company, a statement that does not necessarily entitle the company to the label it needs to gain the appropriate license. Other streaming TV startups, including Ivi and FilmOn, have previously applied and been denied.

Have something to add to this story? Share it in the comments.