Telletopia To Start Cable-Like Internet OTT Service

In sharp contrast to other recent controversial cable-like OTT Internet services, a new nonprofit startup will offer a live, local TV over-the-top Internet-delivered service with one big difference: Financial deals with TV networks and stations.

For $15 to $20 a month, TV consumers in local markets can get over-the-air broadcast TV stations via the Internet from San Diego, California company Telletopia. Consumers don’t need a contract, nor a set-top box -- just Internet access and a Web browser.

Gary Koerper, cofounder/CEO of Telletopia, told Media Daily News the aim is to be the “Netflix of live TV.” It will launch in 14 California television markets in 2016, with expansion plans across the U.S. through 2016 and into 2017.

Unlike other controversial companies such as Aereo and FilmOn, which have faced lawsuits from TV networks, Telletopia seeks deals with TV stations, paying retrans fees for their content.

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With regard to FilmOn, Michael Librizzi, cofounder/CFO of Telletopia, says “they attempted to steal the signal, not pay the broadcasters, and in the process, created an enemy out of the companies they really needed to serve... People that produce the content really do deserve to get paid for that content.”

One main difference with Telletopia is that it is a nonprofit organization -- which the company says “can legally retransmit broadcast TV over the Internet.”

Koerper says the company is taking its cue from the FCC commissioners that the marketplace is looking for more competition. But unlike FilmOn or Aereo, Telletopia executives say they are not looking for find “loopholes” in the law.

What it needs is for one FCC ruling to become permanent. A pending ruling “will reclassify OVDs (online video distributors) like Telletopia as multichannel video programming distributors (MVPD), giving the company the ability to negotiate with local broadcasters to carry their signals -- just like cable, satellite and telco pay TV providers."

Telletopia hopes that by focusing just on broadcast TV stations it will create a niche market. And that means pay TV providers -- cable, satellite, and telco operators -- can focus on cable networks/programming deals and growing broadband businesses.

In this regard, Telletopia sees complementing “skinny” TV bundles like Sling TV, which focuses mostly on delivering cable TV networks to TV consumers.

Many local TV station groups are backing what Telletopia is doing, as well as three of the four major TV broadcast networks, according to company executives.

The benefit for TV stations? They can expand their traditional TV advertising deals into the Internet space -- which up until now has been a problem. Concerning TV stations own individual online efforts, Koerper says: “You won’t see their own ads that they sold because they didn’t get rights for that distribution.”

He adds: “If we solve the copyright problem, and we are a MVPD -- therefore putting [TV stations content] on 24/7 streamed with their ads on the Internet -- they are getting brand new eyeballs, and they didn’t have to clear a thing.”

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