The Aereo Case Isn't About Aereo, But About The Future Of Cloud Computing And Innovation

from the there's-much-more-at-stake-here dept

We've been writing quite a bit about the Aereo case lately, which is scheduled to be heard by the Supreme Court in late April. The case has an awful lot of powerful people and organizations lining up on both sides, filing briefs with the Supreme Court. Some have pointed out that Aereo's technology really isn't particularly innovative, and in fact, we've discussed how its setup is basically insane from a technology standpoint, but that the company is forced into building it that way to stay within the law (or so it and its supporters believe).

But some seem to be wondering why this one technology company, with something of a legal kludge is so important. It is incredibly important for reasons that have almost nothing to do with Aereo's actual service. Rather, it's about how the Supreme Court will interpret a key part of the Copyright Act, which could have an astoundingly bad chilling effect on pretty much all cloud computing. This may not seem obvious at first glance, since few people associate Aereo with cloud computing. Matt Schruers does a nice job breaking down the key point, however, as to why this one decision will have far reaching implications well beyond Aereo. And it all comes down to how the Supreme Court defines what is a "public performance."

Aereo’s position is that when Aereo subscribers pay for access to an antenna and direct it to send them back a unique copy of a particular broadcast, this is private. Different users access different antennae at different times, and each user receives a different copy of a work — even if they’re watching the same broadcast. Aereo isn’t rebroadcasting one work to thousands; it gives technology to thousands who at different times use that technology to access and possibly store different copies of works that they’re already lawfully entitled to receive. This is not unlike the Sony Betamax, which didn’t copy television, but gave thousands of consumers the technology to make reproductions of television content that they were already lawfully receiving.

Broadcasters have responded by saying that none of this matters; Aereo is infringing, they contend, so long as a given work is made available to multiple members of the public, even if Aereo does it with different unique copies, and at different times.

The problem with this rationale is that it applies with equal force to cloud storage like Dropbox, SkyDrive, iCloud, and Google Drive. If multiple people store their own, unique, lawfully acquired copy of the latest hit single in the cloud, and then play it to themselves over the Internet, that too sounds like the broadcasters’ version of a public performance. The anti-Aereo rationale doesn’t distinguish between Aereo and the cloud.

If you don't think that copyright holders won't take a victory here and go after various cloud services, you haven't been paying attention to the history of copyright fights over the past few decades.

And this is part of why the US Solicitor General's brief in support of the broadcasters is so ridiculously problematic. It tries to address that issue of cloud computing, by basically saying it might not be a big deal, because no company will require a license. However, other briefs in support of the broadcasters say it's no big deal because everyone can just get a license. One of those can't be true.

the U.S. Government (USG), for example, carefully hedges, saying that a decision for the broadcasters “need not threaten cloud computing.” It conspicuously does not argue that it will not threaten the cloud — only that the decision need not, implicitly conceding that a decision for the broadcasters could still be fatal for the cloud. The USG’s rationale is that as long as a consumer has lawfully acquired media in the first place, no cloud service need worry that someone will demand a license. Inconveniently for the USG, however, several other briefs filed concurrently argue that cloud computing services need not worry because, hey, everyone can just get a license! Setting aside the fact that there’s no way to ensure that all files in the cloud are licensed, this point substantially undercuts the USG’s position. Even as the USG is telling the Court that cloud services need not fear they’ll be demanded to take licenses for everything users put in the cloud, other interests are telling the Court that cloud services should do exactly that. Arguably, it doesn’t advance the broadcasters’ case that even their supporters cannot agree on whether cloud services would have licensing problems.

The ruling in this case matters, even if you don't care at all for Aereo's particular service. The wider impact on a variety of useful services could be massive. In fact, we've seen this before. Aereo's court wins to date rely heavily on the ruling that found Cablevision's remote DVR legal -- which similarly focused on defining whether or not that product involved a "public performance" that needed to be licensed. There, the court found that they did not. However, courts in other countries have found otherwise. That set up a nice natural experiment, and Harvard professor Josh Lerner looked at changes in venture capital investment into cloud computing offerings in the immediate aftermath of similar rulings, finding that the Cablevision ruling (saying not a public performance, and thus protecting the cloud) helped to spur tremendous investment in innovative new services -- to the tune of about $1 billion.

No matter what you think of Aereo, this decision will have a major impact on what sort of internet we have going forward.

Filed Under: broadcast, cloud computing, copyright, supreme court
Companies: aereo

International Music Organizations Claim Aereo Must Be Illegal Because Of International Trade Agreements

from the those-darn-international-obligations dept

For many years, we've highlighted how copyright maximalists have abused the international trade process to expand copyright monopolies around the globe. If you're interested in the history there, I highly recommend the book Information Feudalism: Who Owns the Knowledge Economy?, which details much of the history. Defenders of this policy love to pretend that international trade agreements can't bind US law, but reality is quite different. Time and time again, we've seen maximalists use international agreements to get their way either in ratcheting up copyright law even further, or pressuring courts into certain positions. This is one of the reasons (one of many) that we're so concerned about new agreements like the TPP and TTIP/TAFTA. Even if the USTR claims (incorrectly) that nothing in them goes beyond US law today, they can not only limit the changes Congress can make to copyright and patent law, but these issues can show up in court cases, potentially hindering innovation.

Here's a perfect example. We've been covering the Aereo case for quite some time, and as the Supreme Court prepares to hear the case in April, a bunch of international music organizations, led by the IFPI (basically the international version of the RIAA), have filed an amicus brief that pretty clearly says that the Supreme Court has to rule against Aereo because of existing international trade agreements that the US has signed. No joke. The brief directly claims that the appeals court ruling that found in favor of Aereo "places the United States in violation of its multilateral treaty commitments," as well as "its bilateral and regional agreements," and further that the Supreme Court has a duty to find against Aereo in order to respect the US's "treaty commitments."

Reading through the brief, you can see just how much copyright maximalists have succeeded in putting together a huge mess of international agreements (often built around issues totally unrelated to copyright, with a few copyright specific ones thrown in) that these groups can now claim require the Supreme Court to outlaw new innovations like Aereo. It further cites rulings in the EU and Canada that it suggests require the Supreme Court to follow suit. While there are some Justices who have made it clear time and time again that they don't care what foreign courts say, others have shown a willingness to follow suit.

Either way, this brief yet again highlights just how nefarious these international trade agreements can be, and how they can come back to bite new innovations years later. Defenders of copyright maximalism will insist that things like TPP and TTIP/TAFTA will have no impact on US law, but if those agreements come into force, you can bet that future US innovations will get stomped out of existence with certain players pointing to those agreements as a reason they need to be shut down.

Filed Under: broadcast, tafta, tpp, trade agreement, ttip, ustr
Companies: aereo, ifpi

ITIF: Ignore 'Paranoid Bloggers' And Pesky 'Populists' - The Comcast Merger Will Be Great

from the your-talking-points-suck dept

As I've been noting, Comcast lobbyists have certainly fired up their sound wall of paid PR folk, consultants, think tanks, and other policy tendrils in a fairly weak attempt to convince everyone that an immeasurably larger and more powerful Comcast is going to be a good thing for everybody. Most of the arguments (correctly) focus on the fact that Time Warner Cable and Comcast don't directly compete so there's no harm, while ignoring that Comcast's ever-increasing size makes it easier for Comcast to bully disruptive Internet video companies using usage caps, restrictive licensing agreements, and peering relationships.

Most of the editorials are quite a lot of fun, like this one by Doug Brake of the Information Technology and Innovation Foundation. The ITIF, if you'd forgotten, was a big backer of SOPA and has championed all manner of IP maximalism, most recently through their support of the TTP agreement. They take money from broadband providers and the MPAA, not that Forbes or anybody else can ever bother to point this out. According to Brake, criticism of the merger is something that's being fabricated by "paranoid bloggers" and spreaders of "misinformation," whose "populist" thinking gives cable companies a bad rap:

"It is popular, especially in the blogosphere, to automatically distrust cable and telecommunications companies, a stance that often leads to inaccurate statements and misunderstandings."

Gosh, that distrust couldn't possibly come from the fact that Comcast is among the lowest ranked companies for customer satisfaction in what's the lowest ranked industry for customer satisfaction across all industries? Bi-annual rate hikes for channels never watched? Full-day technician visit windows that get bumped numerous times for no reason? Jacking up modem rental fees? Horrible customer support? Burying rate hikes misleadingly in below-the-line fees? Any of this ringing a bell, Doug? It's worth noting that brand impression of Time Warner Cable has actually somehow gotten even worse since the merger was announced, which is pretty impressive.

Brake stumbles forth valiantly to then argue that those worried about a larger Comcast needn't do so -- because competitive pressure from phone companies will keep Comcast executives honest:

"The broadband populists that dominate this conversation like to claim that DSL is not fast enough to be a competitor to cable. But some of DSL’s 31 million subscribers (compared to cable’s 51.5 million) might disagree. And there is good reason to expect DSL speeds to improve – new technology, called vectored DSL, promises 100 Mbps under the right circumstances. And of course, in 6 of the 19 metros, Verizon FIOS fiber service is a robust competitor."

First, I'm not entirely sure in what world being a "populist" is an insult; the dictionary definition of populism suggests someone who is looking out for the people (what a bunch of jerks). Second, if the argument is that the phone companies will keep Comcast honest as they grow, apparently Mr. Brake isn't aware of the fact that AT&T and Verizon are backing away from huge swaths of the fixed-line broadband market because they don't want to upgrade them (as in, ever), which would leave the freshly-merged Comcast Time Warner Cable with less competition than ever before. In turn, Comcast will soon have a greater ability to impose the usage caps they've been busy testing in uncompetitive markets without competitive repercussions. Brake then goes on to repeat another core merger supporter talking point -- Google Fiber will somehow keep Comcast honest:

"Let’s not forget another big announcement made on the heels of the merger proposal – Google has started early plans to expand its fiber build-out to nine new metro areas. The timing of Google’s release exposes a key flaw in Crawford’s arguments against the merger: immediately after Comcast’s announcement, many detractors dismissed Google fiber as a viable competitor to cable because it is in only a handful of cities."

Right, except that that Google Fiber announcement to "expand to nine new metro areas" never actually stated anything of the sort, something Brake would know if he'd actually read it. Google Fiber, which currently only serves a handful of users in Kansas City and Provo, Utah, simply announced it would work with cities in nine markets to examine improving infrastructure. One or two might actually see service sometime by 2015, but it's not keeping Comcast executives up at night anytime soon. This talking point that companies like Google Fiber and Hulu (which Comcast co-owns) will generate enough pressure to keep Comcast honest is laughable, but it keeps getting trotted out like an ugly show pony.

You'd think for the money Comcast is pouring into these think tanks annually, one of them would actually understand the industry they're writing about and be able to make coherent arguments in support of the merger. Surely there have to be some legitimate benefits to letting Comcast get immensely more massive? Perhaps suggest that shiny new taxpayer-subsidized skyscraper Comcast is building in Philadelphia will scare away the foul shard devils from the vile astral plane of Kerithuth? Maybe suggest the combined new super Comcast will impact the earth's gravitational pull just enough to give us all super powers that could help us fight said looming cross-dimensional invasion? Surely these groups can do better. Paranoid populists everywhere demand it!

Filed Under: broadband, broadcast, dsl, itif, lobbying
Companies: comcast, mpaa, time warner cable

US Solicitor General's Office, Run By Former Top MPAA Lawyer, Shockingly Sides With Broadcasters Over Aereo

from the it's-the-little-things dept

As the Aereo case is set to be heard by the Supreme Court in April, there have been a flurry of amicus briefs filed on both sides. It's disappointing, but not too surprising, to see that the official position of the administration is to side with the broadcasters over Aereo, arguing effectively that the length of a cord changes the copyright calculation. This position goes against every Aereo court ruling to date, except for one odd ruling in Utah. That the US government would take this position isn't too surprising. After all, the Solicitor General of the US (whose office prepared this brief) is Donald Verrilli -- who probably would have been representing the broadcasters in this case if it had happened a few years ago. For years, he was Hollywood's go to litigator for their big copyright cases, including the infamous Grokster case, in which he convinced the Supreme Court to create a new "inducement" standard for infringement. Technically, Verrilli "recused" himself from this filing, but what were the chances that the folks who report to him were going to file a brief that sided against the organization most likely to employ Verrilli once he leaves government service?

The key issue in the case is whether or not Aereo is retransmitting to the public. As we've explained multiple times, Aereo's setup is technologically insane, but legally sensible, given just how stupid copyright law is today. Because it's recognized as legal that you can place shift legally accessible TV (a la a Slingbox) and that you can watch over-the-air TV via a personal antenna (duh), Aereo has set up "individual antennas" for each customer, connected to the equivalent of a Slingbox, such that you can "subscribe" and get access to over-the-air channels. It's technically no different than you setting up an antenna and Slingbox in your home, except that the distance of the cable between the antenna/Slingbox combo and your TV is much longer with Aereo (across the internet) than in your home. However, broadcasters and other supporters of them (now including the US government) argue that this longer cable somehow, magically, turns this individual antenna into a public broadcast for which Aereo should be expected to pay ridiculously steep retransmission fees.

The arguments put forth by the US government are basically a carbon copy of what the broadcasters are saying. They completely reject the length of the cable argument by basically saying that, what really matters, is how this might undermine the retransmission fees broadcasters get. Specifically, they say that it doesn't matter that people at home can create their own Aereo legally, what matters more is that Aereo looks too much like cable retransmission:

Respondent observes that, from the subscriber's perspective, respondent's service provides substantially the same functionality that consumers could obtain by purchasing equipment for their homes. In enacting the 1976 Copyright Act amendments, however, Congress overrode decisions of this Court that drew on the same analogy. In applying the Copyright Act in its current form, the more important functional equivalence is between respondent and the cable systems that the 1976 Congress brought within the Copyright Act's purview.

But that totally and completely ignores some pretty significant differences, especially around how Aereo has an individual antenna for each user, as well as making sure that there's an individual copy made. That was not the case at all with cable systems.

While this filing is careful to state that it is not trying to undermine the important precedent set in the Cablevision case (which said a remote DVR controlled by a cable company is legal), which was a key reason why the lower courts sided with Aereo, it's important to note that back when the Cablevision case was up for appeal to the Supreme Court, Verrilli's predecessor sided with innovation over claiming infringement. It's just now that the Solicitor General who has a long history of representing Hollywood is in control, that the administration seems to be happy to side with copyright maximalism, over innovation. The one potential saving grace: the prior solicitor general who sided with Cablevision and against the broadcasters? Elena Kagan... is now a Justice on the Supreme Court.

Filed Under: broadcast, solicitor general, streaming, television
Companies: aereo, mpaa

Broadcasters Warn Supremes Of The Innumerable Non-Existent Horrors That Will Befall Everyone If Aereo Wins

from the your-threat-is-not-even-remotely-scary dept

As we've noted for some time, broadcasters have long argued that if they're not given what they want they're sure to go out of business, even if the evidence never actually supports that. Their latest incarnation of that has been in heavy rotation during their battle against live TV streaming service Aereo, with broadcasters arguing that if Aereo is allowed to survive, they'll pull all of their broadcast channels from over the air and move them to paid cable tiers. As we've stated previously they should go right ahead and do that, as the publicly-owned airwaves they're currently using can certainly be put to good use. Also, enjoy the wrath of sports fans (and the oodles of politicians who'll side with sports fans to earn political brownie points) when you attempt to do that.

Gearing up for their Supreme Court showdown with Aereo on April 22, broadcasters have once again gleefully pulled out this empty threat. Hoping to convince the court's eight Judges (Justice Alito recused himself, possibly due to stock holdings) an Aereo win would be disastrous, the petitioners proclaim that free "quality" programming will cease to exist:

"The TV broadcasters reject Aereo's conclusion that cloud computing and other novel technologies could be at stake, but they do raise dire warnings about what might happen should the Supreme Court rule in Aereo's favor. As the brief states, "Indeed, if that is the world in which broadcasters must live, then they may be forced to reconsider whether they can afford to continue making the same quantity and quality of programming available to the public for free in the first place."

The debate over the word "quality" aside, note the pretense again that they they would struggle with finances, ignoring the fact that CBS posted record earnings last year and even CBS's CEO recently admitting that an Aereo win would have no serious impact on earnings. Perhaps scarier is this dire warning included in the brief by the petitioners:

"If the transmit clause could be circumvented through the simple expedient of simultaneously supplying each user with a distinct transmission generated from a distinct copy, then cable and satellite companies could potentially devise Aereo-like workarounds of their own, and in the process render the transmit clause a dead letter."

Wow, that would be rough, huh? Cable and satellite operators giving subscribers more flexible options for content that might in the process make a customer or two happy? Could even Lovecraft or Dante forge a more horrifying hellscape? Is there any point in living?

Filed Under: broadcast, retransmission, streaming, supreme court, television
Companies: aereo

Broadcasters Get Aereo Shut Down In Salt Lake City and Denver

from the you-can't-win-'em-all dept

A string of Aereo legal wins has come to an end, with US District Judge Dale Kimball of Utah imposing a preliminary injunction (pdf) on Aereo's existing operations in both Utah and Colorado. The injunction covers all of the 10th circuit, so it will technically prevent any future Aereo operations in all of Wyoming, New Mexico, and Oklahoma as well. Aereo currently operates in ten markets, but in recent weeks has bumped into some unspecified capacity issues in both New York and Atlanta (I've asked, they won't get specific about what kind of capacity issues they've faced).

Kimball wasn't particularly receptive to Aereo's claims that their tiny OTA antennas -- one rented to each Aereo subscriber -- allow the live streaming TV company to bypass the "Transmit Clause" of the 1976 Copyright Act:

"Based on the plain language of the 1976 Copyright Act and the clear intent of Congress, this court concludes that Aereo is engaging in copyright infringement of Plaintiffs’ programs. Despite its attempt to design a device or process outside the scope of the 1976 Copyright Act, Aereo’s device or process transmits Plaintiffs’ copyrighted programs to the public."

Similar legal assaults by the broadcast industry had proven unsuccessful in Boston and New York. Needless to say, broadcasters like Fox were pleased by the result, calling the ruling "a significant win for both broadcasters and content owners" that will "prohibit Aereo from stealing our broadcast signal." Riding on Aereo's New York win by using the Cablevision precedent, the battle now heads to the Supreme Court for the real showdown on April 22. Should Aereo win that, broadcasters could face a number of similar services offered by cable operators eager to bypass soaring retransmission fees.

Filed Under: broadcast, colorado, new mexico, oklahoma, retransmission, television, utah, wyoming
Companies: aereo

Retrans Fights Get More Annoying As Cable Hits Users With Sneaky Below-The-Line 'Broadcast TV' Fees

from the nickel-and-dime dept

If you hadn't noticed (read: are a cord cutter), the battle over higher retransmission fees between broadcasters and cable operators has grown immensely more annoying for consumers, with last year seeing a record amount of content blacked out as the two sides fought over rates. Consumers are usually put in the middle of the battle, with broadcasters blaming pay TV companies for the breakdown in negotiations and vice versa; both sides then bombarding consumers with calls or on-screen tickers insisting they act immediately and call the other guy to complain. We've seen these fights evolve over the years to include the blackout of online content as well, with the Time Warner Cable and CBS fight last year reaching entirely new levels of annoying.

After the smoke clears, confidential deals are struck, and the pretense of caring about how much consumers are paying fades away, the costs then get passed on to the consumer as the icing on an ugly process. Normally, cable companies include these hikes in the cost of doing business on your final bill. However, a growing number of cable companies are embedding a portion of these hikes in below the line fees, allowing them to jack up your cable bill, but still advertise the same price. Comcast, for example, recently started charging users a $1.50 Broadcast TV Fee that the company insists is part of improving your entertainment experience:

"At Comcast we are committed to constantly improving your entertainment and communications experience, and we continue to invest in making your services even better. As we make these and other investments, we periodically need to adjust prices due to increases we incur in programming and other business costs. Among these price changes, we have itemized a Broadcast TV Fee in order to identify some of the rising costs or retransmitting broadcast television signals. In recent years, the cost of retransmitting broadcast television signals has increased significantly, and going forward we want to address these increasing costs through a separate itemized charge."

While I know massive multi-billion-dollar new skyscrapers don't build themselves and the $45.2 billion needed for new mergers doesn't grow on trees, I was always under the impression that part of the primary cost of doing business in the cable industry was programming -- and as such, that should be included in the normal price of service (the same service broadcast and cable raises the price of sometimes as often as twice a year). Comcast certainly isn't alone in this practice; Charter has imposed this kind of charge for more than a year, and AT&T this week notified U-Verse customers they'll now be paying $3 per month instead of $2 for the fee. If you're on Time Warner Cable, you should be getting a notice soon that they're adding the fee as well.

Again, burying ordinary costs of this kind is a common tactic in the cable TV industry, and it's a form of false advertising regulators seem to believe is all in good fun. It's useful if you're a cable operator interested in jacking up prices while keeping advertised prices the same, bumping prices on people you've convinced have signed "price lock guarantees," or raising rates on users who are otherwise paying a fixed-rate under contract. It's also useful if you want to trot out statistics showing how cable rate hikes are slightly less than they actually are. Or, as Comcast phrases it, ensuring you have a really fantastic, compelling television "experience" and are getting the utmost "value" for your entertainment dollar. Enjoy!

Filed Under: broadcast, cable, retransmission, television
Companies: cbs, time warner

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

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

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.

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

News Corp. Finally Realizes Locked Up, iPad-Only News Publication Was A Dud, Shuts It Down

from the about-time dept

Back in 2010 there was all sorts of buzz around News Corp. investing a ton of money into a "secret" project to launch an iPad-only paywalled publication called "the Daily." Before it even launched, we explained why this was a bad idea that missed the point. We also highlighted Rupert Murdoch/News Corps' long list of failed internet projects -- with the large majority of them flopping because they were about trying to create "broadcast" style properties online, without recognizing that the internet is more of a communications (many-to-many) medium than a broadcast (one-to-many) medium. And, of course, soon after The Daily launched there was evidence that very few people cared.

To be honest, given all the bad press about how few people were reading it, combined with stories of staffers jumping ship soon after it was launched, I had kind of figured that The Daily had already been shut down. However, the latest news is that News Corp. is finally putting it out of its misery and shutting it down, giving most staffers 3 months severance. A few staffers are being folded into the NY Post:

News Corporation also announced that effective immediately, Jesse Angelo, the founding Editor-in-Chief of The Daily and long-time Executive Editor of The New York Post, will assume the role of Publisher of The New York Post. As part of a digital restructuring initiative, the company will cease standalone publication of The Daily iPad app on December 15, 2012, though the brand will live on in other channels. Technology and other assets from The Daily, including some staff, will be folded into The Post.

Mr. Murdoch said: “From its launch, The Daily was a bold experiment in digital publishing and an amazing vehicle for innovation. Unfortunately, our experience was that we could not find a large enough audience quickly enough to convince us the business model was sustainable in the long-term..."

Apparently the site was losing $30 million a year.

Perhaps this should stand as a response to the people who insist that giving away newspaper content free online was "the original sin" of the industry and they should have focused on paywalls. Paywalls don't help you build up "a large enough audience." The link above quotes a reporter there saying: "It was a really cool, hip product. I think this is nothing more than bad timing." I'd say it was much more of a bad model -- both business model and delivery model -- than "bad timing."

Filed Under: broadcast, communication, failure, paywall, rupert murdoch, shut down, the daily