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Aereo could win big in fee dispute between CBS and Time Warner Cable

Aereo could win big in fee dispute between CBS and Time Warner Cable


TWC says if CBS stops supplying shows to its cable customers, it will recommend they try Aereo

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Aereo CEO Chet Kanojia

Time Warner Cable says if it can't reach an agreement with CBS over the fees it pays to retransmit the network's programs, it will recommend that customers try Aereo, according to a published report.

A TWC spokeswoman told The New York Times today that if CBS pulls its shows from TWC, it would recommend to its New York customers to try Aereo, the service that, because of its unique business model, doesn't pay any retransmission fees to broadcasters to access their TV shows.

No question that if TWC makes good on its threat, it will help raise Aereo's profile According to reports, TWC is reluctant to pay CBS' price to retransmit the network's shows, and just like previous clashes over retransmission fees, it's the customers who will have less to watch if a deal can't be reached. Meanwhile, both sides are using their access to TV viewers to paint the other as the greedy party. CBS, however, has now raised the stakes by blasting TWC with the use of its radio stations, according to a report by Variety.

The dispute has all the potential to become one of the nastiest ever over retransmission fees. Regardless, there's no question that if TWC makes good on its threat to promote Aereo, it will certainly help raise that company's profile, and that's something CBS is unlikely to want. Last year, CBS, NBC, Fox, and numerous other TV programmers filed a copyright suit against Aereo and accused it of unlawfully accessing their programs. Aereo is one of the companies that has used technology to carve out a new distribution model while slaloming past copyright law. The company argued that it doesn't have to pay because all it does is link subscribers with over-the-air TV broadcasts using dime-sized TV antennas housed at the company's facilities. With web-connected devices, the customer controls an individual aerial just like they do with a set of rabbit ears.

"If [Aereo] is found legal, we could conceivably use similar technology."

Two federal courts have sided with Aereo and the company is waiting to see what the broadcasters do next. Not coincidentally, TWC chief executive Glenn Britt, sounded very interested in Aereo's technology as his company was preparing for this clash with CBS. In May, he said "what Aereo is doing to bring broadcast signals to its customers is interesting," and "if it is found legal, we could conceivably use similar technology."

Les Moonves, CBS CEO, warned that if Aereo is allowed to operate without paying for his company's content, then CBS would just remove it from the airwaves.

<strong>Update:</strong> Aereo has announced the company will begin operating in Salt Lake City next month. The other cities with Aereo's service are New York, Boston, and Atlanta and it will soon also open in Chicago. Aereo has said it hopes to be in more than 20 markets by the end of the year.