CBS Admits Aereo Supreme Court Win Wouldn't Hurt CBS, Might Make Things Better For Everybody

from the we-really-feel-for-you dept

Mon, Feb 17th 2014 11:23am — Karl Bode

Last year CBS joined a number of broadcasters in whining incessantly about how if Aereo was allowed to continue living, the "struggling" networks would be forced to pull their content from over the air broadcasts and move to cable. It's part of a long, long history of broadcasters pretending that if things don't go just they way they want them to, they'll surely go out of business. The threat to pull broadcasts was aimed at scaring Congress into passing protectionist legislation, and as we noted at the time it's something CBS should just shut up and do -- given the public could probably come up for better uses for their spectrum.

After insisting for some time that big bully Aereo will drive poor little CBS out of business (the same CBS that posted record earnings last year and 20% higher profits in the fourth quarter), it's rather amusing to see CBS CEO Les Moonves insist in an interview with CNBC that CBS won't feel any financial impact from a Supreme Court win. In fact, Moonves notes the win will likely result in a slew of new innovative products as cable companies -- and in response the networks themselves -- rush to follow Aereo's lead:

"Look, we expect that the Supreme Court will do the right thing and side with the people who are providing the content. Not the people who are taking our content and using it illegally, which is our point of view. However, if that should happen, if the worst should happen, there are so many other alternatives that will not; so this will not affect our bottom line. Obviously the networks collectively could do their own version of Aereo, there's a way to put our signal on cable without putting it over the air. There's also over-the-top for us. So, there are many, many alternatives to allow people to receive our signal no matter what happens. It's something that the Supreme Court will decide, but it's not anything that we're deeply concerned about because we have alternatives."

In other words, an Aereo Supreme court win not only wouldn't dent CBS in the slightest (something we already knew), it would result in a variety of new ways for people to receive content. In fact, it seems like an Aereo win would probably be good for pretty much everybody but Aereo. Should Aereo win, they would suddenly face all of the satellite, cable and pay TV companies offering similar or better services over the Internet to help slightly reduce retransmission fees. That would in turn result in broadcasters coming up with more innovative Internet TV services of their own to balance any retransmission fee losses.

More products, more options for consumers, more innovative services, more money for everyone and less time in court; it sounds like a real nightmare scenario for CBS and everybody involved.

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Filed Under: broadcast, cable, les moonves, supreme court, television
Companies: aereo, cbs

21 Comments

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That One Guy (profile), 17 Feb 2014 @ 9:59am

A titch too optimistic there...
Should Aereo win, they would suddenly face all of the satellite, cable and pay TV companies offering similar or better services over the Internet to help slightly reduce retransmission fees.

As history shows, what's smart to do is rarely what companies/groups like that actually do, as shown quite well with the recording industry, who had to be dragged, kicking and screaming, into the digital market, and who still do everything they can to crush it or otherwise sabotage it.

So while yes, they could potentially completely wipe the floor with Aereo by offering competing services, odds are such competition would be few and far in between, and far more locked down and anti-consumer than the service Aereo is trying to provide.
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Anonymous Coward, 17 Feb 2014 @ 11:46am

people have been saying the same sort of things about the way the entertainment industries and Hollywood would probably be better off, but wouldn't be any worse off, but like all members of that fraternity, they wont listen. they insist it isn't about the monetary losses they manage to pull out of their asses, but if that were anywhere near true, they wouldn't insist on such exorbitant amounts in fines!!
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That Anonymous Coward (profile), 17 Feb 2014 @ 11:49am

I think they are still hoping to run Aereo out of cash then walk in buy up the tech and find some way to make it less useful for consumers and then roll it out.
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Anonymous Coward, 17 Feb 2014 @ 11:52am

Looks like Les Moonves, thinks Aereo will most likely prevail victorious in allowing live TV to be streamed over the internet.

It was going to happen eventually, through innovation. No thanks to Les Moonves and his compulsive lying. He's now in damage control mode, making sure the price of CBS stocks don't slide.

I tell you, I can read most of these liars like open books.
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Karl Bode (profile), 17 Feb 2014 @ 12:02pm

Re: A titch too optimistic there...
I'm not saying they'll all create great services and we'll live in a magic Utopia, but even if just a few of them jumped in we're talking about a dramatic improvement. Dish has expressed interest in such a service, particularly after their battle with broadcasters over the ad-skipping functionality in their hopper DVR. They have motivation here to bypass the retransmission fees they all loathe.
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Anonymous Coward, 17 Feb 2014 @ 12:10pm

Re:
I can read most of these liars like open books.

For the untrained, watch their lips. When their lips move, there is a very good chance that we are watching Reality TV
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Karl Bode (profile), 17 Feb 2014 @ 12:18pm

Re: A titch too optimistic there...
As an aside you may be the first person I've ever known who called me optimistic. :)
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tintin (profile), 17 Feb 2014 @ 12:19pm

Someone has to pay to keep 2 and a half men on the air.
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JEDIDIAH, 17 Feb 2014 @ 12:27pm

A crappy sitcom is more expense than you would think.
Apparently, the stars get a pretty penny once they have won the ratings lottery. So, a crappy sitcom ends up being much more expensive than you would expect just by judging the production values and what they're trying to pull off on-screen.

It's all a big house of cards that no one wants to scrutinize too much...
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jupiterkansas (profile), 17 Feb 2014 @ 12:44pm

Re:
It's not about their monetary losses. It about someone else making money and them not getting a cut.
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pixelpusher220 (profile), 17 Feb 2014 @ 1:04pm

Re: Re: A titch too optimistic there...
Sadly, an Aereo win will also reinforce the 'legality' of requiring a separate antenna for every subscriber. Time to buy stock in whoever makes them :)
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Anonymous Coward, 17 Feb 2014 @ 1:33pm

What they are saying is that they can and will kill Aereo either way.
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Anonymous Coward, 17 Feb 2014 @ 1:48pm

Re: Re: Re: A titch too optimistic there...
What I expect will happen will be after they win, and the big companies step in to start to use this ruling they will start to whittle away at the individual antenna thing by using a device with a single antenna that handles multiple frequencies or some other means where each subscriber has a dedicated stream that is paired to the unit for their account distinguishing it from being a "broadcast" retransmission. The one antenna per subscriber thing just makes it easier to make their point in court. The real issue is whether it is a dedicated stream or a broadcast stream.
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Anonymous Coward, 17 Feb 2014 @ 1:53pm

Re: Re: Re: Re: A titch too optimistic there...
Nevermind, I don't know what I was thinking. I brain-farted on how Aereo's service actually works for a minute. Still I think there will be some other challenge to this that will change that.
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Jim, 17 Feb 2014 @ 2:37pm

Yes, this is an admission that CBS will likely lose. But, maybe being optimistic here, but if Aereo provides a better service than the potentially coming competitive offerings of the networks, Aereo will win. In fact, it's hard to spin this positively for the major media conglomerates, or as anything but an admission of failure for the "500 channel universe.

Cable/satellite, as an industry, is a cesspool, too expensive, nothing of quality, nothing on but reality shows. And, as a sports viewer, I'll tell you, they've destroyed most of that as well. Hence, all of the cord cutting. So, anything that accelerates that process is a loss for anyone who runs lots of lousy cable channels. This is an opportunity, however, for the broadcast segment of the industry to provide a service and to realize growth, in an area where the growth is coming, i.e., not to bundled cable TV service.
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Just Sayin', 17 Feb 2014 @ 10:32pm

Not exactly what he said
"More products, more options for consumers, more innovative services, more money for everyone and less time in court; it sounds like a real nightmare scenario for CBS and everybody involved."

I suspect you don't have a lot of experience in decoding corporate bravado. Most of it is pure BS, as aereo would undermine both the broadcast model and cable TV model, plus it would likely to some serious long term harm to the entire network / affiliate model on the way by.

It's doubtful that an Aereo client will even be invovled in ratings for TV shows, which means the more people that move to this system, the fewer measured viewers may come up. Since ad rates are set by viewership, there could be real problems brewing.

The network / affiliate model could be at risk as well, because you could picture mailbox companies selling addresses within aereo served zones so that people from outside can get service, bypassing their local affiliates and going for the more major markets. Why watch the 3 channels in Podunk when you can get it all from New York, right?

The real one point that you have to pay attention to is the one that I have mentioned many times before, "there's a way to put our signal on cable without putting it over the air". Basically, there is great potential that CBS (and others) could move to a more direct distribution model, where their prime time stuff is available only through cable and satellite providers or by direct subscription, leaving their affiliate stations with last weeks reruns. That would leave Aereo out to dry with older content and a very incomplete product which wouldn't compete very well. Since 85% of all viewers get their stuff through cable or sat TV, the piss off rate would be pretty low. Add in some nice monthly subscription streaming services and they have the market once again.

Now, that would leave less choices for consumers, would hurt the poorest people who can't afford cable, and would generally strengthen the network's direct control over distribution. Far from a nightmare scenario, it might actually be their dream solution that gets them around all the anti-trust issues, moves them away from FCC regulation, and gives them freer reign to deal directly with consumers and take a bigger slice of the pie.

Careful what you wish for...

(oh, and thanks to the techdirt minions for continuing to delay my posts. 2 days generally should be enough to make me irrelevant, but it's enough to make you look foolish and two faced).
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Anonymous Coward, 18 Feb 2014 @ 9:19am

Such Arrogance.
"Look, we expect that the Supreme Court will do the right thing and side with the people who are providing the content."

I think it will be up to the court to decide what is "the right thing". Not you, Les.
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John Fenderson (profile), 18 Feb 2014 @ 10:47am

Re: Not exactly what he said
"It's doubtful that an Aereo client will even be invovled in ratings for TV shows"

Perhaps, but that's a problem with the ratings agencies, and one they could fix. That's certainly not a reason to say Aereo-like services shouldn't be allowed.

"Why watch the 3 channels in Podunk when you can get it all from New York, right?"

Perhaps I misunderstand their model, but I believe that Aereo doesn't allow you to do this at all. You have to be in the market area to receive the broadcasts.
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nasch (profile), 18 Feb 2014 @ 5:21pm

Re: Not exactly what he said
oh, and thanks to the techdirt minions for continuing to delay my posts. 2 days generally should be enough to make me irrelevant

What are you talking about? You comment was posted 11 hours after the article went up.
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Anonymous Coward, 21 Feb 2014 @ 1:22pm

Re: Re: Re: A titch too optimistic there...
But then, the companies will fight to change it once THEY start losing money because of it
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Anonymous Coward, 19 Mar 2014 @ 12:54am

Re: Re: Not exactly what he said
He's a lying fucktard who just hates it when due process is enforced.
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