Aereo Joins Influx Of Low-Cost TV/Video Services

by Wayne Friedman, Feb 15, 2012, 1:22 PM

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Program packages costing consumers around $10 per month have been attracting TV business entrepreneurs.

For example, Netflix basic streaming and Hulu Plus both cost $7.99 a month, and a number of local digital TV packages have been priced around $10. The trouble is that not everyone wants to pay the same freight to the program owners.

Aereo, a New York City service backed by Barry Diller, is a new $12 alternative TV package looking to test the waters. This one -- in part -- tries to go where the likes of FilmOn and ivi TV went before: retransmitting over-the-air broadcast signals digitally to consumers.

History may not be on Aereo's side. FilmOn and ivi TV couldn't make the case that they had the right to re-air broadcast signals without some sort of payment to stations. The two companies argued that they were essentially cable operators.

Aereo tries a different angle, saying that consumers have the right to receive broadcast stations signals over the air by an "antenna." But Aero's consumers use an antenna that's essentially stored at one Brooklyn location -- and then digitally transferred to  devices like iPads and iPhones, as well as to regular TVs.

So what's the $12 fee for? "Technological services." Ah.

No doubt, broadcasters will make the case that any new TV/video retailer -- or middleman -- is looking to make a buck off their programming wares.  That's because, without Aereo, consumers could still get those stations' signals for free.

The real issue is the driving force behind these new wave of low-cost TV/video services. I'm guessing that consumers - - even those not necessarily from financially depressed homes -- may not want put all their eggs into one entertainment basket.

With so many options available to receive TV shows and movies, some consumers may want to add and subtract services -- especially if they only cost $10 or so a month. This can be far cheaper than $100 to $125 a month bills from regular cable operators, satellite distributors, or teleco  packagers.

Why not combine Netflix, Hulu Plus, and one of your local cable operator's low-cost packages that provide  some bare-bones cable networks? That's still a cheaper overall deal.

Smaller, simpler services might for the foreseeable future be the key to satisfying viewers’ video/TV/movie entertainment needs.

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