Light Reading

Aereo Plans Faster Growth Amid Legal Drama

Alan Breznick
1/9/2014
50%
50%

Despite the continuing legal efforts by the major US TV broadcasters to knock it out, Aereo is continuing on its merry way and showing no signs of slowing down.

In fact, Aereo Inc. , the video-streaming startup backed by former US broadcasting mogul Barry Diller that now operates in 10 American markets, intends to add five more by mid-February. It then plans to expand to another seven markets by the early summer, boosting its total market coverage to 22 regions, even as broadcasters attempt to take their legal blockade to the US Supreme Court. (See Aereo Fight Heats Up in DC.)

Beyond those plans, Aereo is looking to extend its reach further in the second half of the year. Speaking at the Citi Global investment, Media & Telecommunications conference in Las Vegas Wednesday, Aereo CEO Chet Kanojia said his company is scrambling to beef up its nationwide presence as quickly as possible because it knows that time is of the essence. "We don't want to end up winning the legal battle while losing the bigger battle," he said.

To further fuel its expansion plans, privately held Aereo just raised another $34 million in funding from a group of investors this week. With the fresh infusion of funds, the company has now raised close to $100 million in capital from its backers. (See Aereo Raises $34M .)

Kanojia indicated that more funding will likely be needed for Aereo to reach its goals of nationwide household and device coverage. As with online video providers, he said, it will take "a good deal of capital" for the company to "truly scale" its delivery infrastructure.

While Aereo has not disclosed any customer figures from its initial markets yet, Kanojia did reveal that the company needs just 6,000 paying subscribers to break even in any market. Aereo now charges customers $8 to $12 per month for its mix of local TV stations and cloud-based DVR service.

To his surprise, Kanojia said Aereo has learned from its early deployments that the majority of its customers are watching the service on their big-screen TVs, not tablets and other smaller portable devices. He estimated that 60% to 70% of subscribers are viewing Aereo's fare this way, which he considers a very promising sign. "That makes it a very stable product with a low turnover rate," he said.

Although it initially attracted mainly male techies, Kanojia said Aereo has seen its appeal broaden out to young families and young couples with limited disposable income. "It's speaking toward the value question and flexibility," he said.

As a result of these research findings, Aereo is now shifting its marketing efforts to focus more on big-screen users and young households, Kanojia said. In addition, he said the company is looking to develop more apps for customers.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

(5)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
albreznick
50%
50%
albreznick,
User Rank: Blogger
1/13/2014 | 12:56:08 PM
Re: Supreme Court Case Be Damned
Yup. I agree. And I think they're going to win at the Supreme Court too. So it could be a very interesting market to watch. I wonder how many Aereo wannabes we'll see too. 
albreznick
50%
50%
albreznick,
User Rank: Blogger
1/13/2014 | 12:54:22 PM
re:Aereo Growth
Good idea, Wanlord. I bet they're looking at that too. That could really rocket them from a niche service to something much bigger. 
wanlord
50%
50%
wanlord,
User Rank: Light Sabre
1/10/2014 | 9:38:35 AM
re:Aereo Growth
Once they get through these legal hurdles, I think their next strategy should be less focused on having individual sign ups and work to integrate their stream with partners like Apple TV, Google, and other boxes. Having all of that combined is more reason to "cut the cord".  People don't want to pay individual bills for different content sources. I want everything in once place with one bill and one interface.
DOShea
50%
50%
DOShea,
User Rank: Blogger
1/10/2014 | 12:14:27 AM
Re: Supreme Court Case Be Damned
They also don;t seem to be having any problem raising the money for expansion. If they do win in court, things could get very interesting very quickly on the customer front.
albreznick
50%
50%
albreznick,
User Rank: Blogger
1/9/2014 | 6:02:49 PM
Supreme Court Case Be Damned
I have to hand it to the Aereo folks. They're not letting the prospect of extended litigation and a potential Supreme Court battle get in their way or slow them down. What I'd really like to know is how many customers they've signed up so far. I'll have more to say on what Kanojia had to say about retrans consent and related topics in a subsequent blog post.   
Educational Resources
sponsor supplied content
Educational Resources Archive
Flash Poll
From The Founder
The Swedish vendor has undergone a significant transformation during the past few years, adjusting to the demands of next-generation communications companies.
LRTV Documentaries
LTE Paves the Way for the 5G Revolution

4|20|15   |   4:20   |   (0) comments


Håkan Andersson, head of 5G product strategy of the Radio Business Unit at Ericsson, discusses the role of LTE, the US and other industry verticals in building a true 5G ecosystem.
LRTV Documentaries
The 3GPP's Road to 5G Standardization

4|17|15   |   4:43   |   (0) comments


Satoshi Nagata, chairman of the 3GPP's TSG-RAN group and a manager at NTT Docomo, explains the standardization process for 5G, as well as the biggest challenges and opportunities.
LRTV Documentaries
AlcaLu CTO Makes the Case for a New 5G Air Interface

4|16|15   |   3:54   |   (0) comments


Michael Peeters, CTO of wireless at Alcatel-Lucent, explains why 5G will require a new air interface to meet its diverse performance targets.
LRTV Documentaries
AlcaLu + Nokia: The New Uber-Vendor

4|15|15   |   2:42   |   (4) comments


Heavy Reading Senior Analyst Gabriel Brown discusses the technological and competitive opportunities and challenges if a merger between Alcatel-Lucent and Nokia comes to pass.
LRTV Huawei Video Resource Center
Huawei's Data Center Power Play

4|15|15   |   6:22   |   (0) comments


Huawei has developed industry-leading energy efficiency capabilities for its indoor and outdoor data center solutions, explains Dr. Fang Liangzhou, vice president of Huawei's Network Energy product Line.
LRTV Huawei Video Resource Center
Huawei’s Routers, Switches Get the Green Mark

4|15|15   |   2:02   |   (0) comments


TUV Rheinland's Frank Dudley explains how Huawei's routers and switches have been successfully tested by energy efficiency experts and have gained Green Mark Certification.
LRTV Documentaries
A Finn, a Frenchman & a Guy From New Jersey Walk Into a Merger...

4|15|15   |   3:17   |   (0) comments


Stop us if you've heard this one before... Light Reading CEO Founder & CEO Steve Saunders weighs in on the technical and cultural implications of a Nokia and Alcatel-Lucent merger.
LRTV Huawei Video Resource Center
Accounting for Better Solutions

4|10|15   |   02:31   |   (1) comment


Murad Yousuf, CTO at Saudi Arabia's Ministry of Finance (Dept. of Zakat & Income Tax), talks about the benefits of deploying router technology from Huawei.
LRTV Huawei Video Resource Center
What's in Store for Huawei & DataCore?

4|10|15   |   05:44   |   (0) comments


At the CeBIT trade show in Hannover, Germany, George Teixeira, CEO of software-defined storage (SDS) specialist DataCore Software, explains why he has just signed a partnership agreement with Huawei Technologies.
LRTV Huawei Video Resource Center
Du Puts Its Faith in Huawei's Routers

4|9|15   |   3:42   |   (0) comments


Adnan Masood, director of Enterprise MS Solutions Marketing at du, the United Arab Emirates (UAE) operator also known as Emirates Integrated Telecommunications Company, explains why his company chose to use Huawei's multifunctional AR routers as part of its managed enterprise services.
LRTV Huawei Video Resource Center
Huawei Gets Active in the Data Center

4|9|15   |   3:17   |   (0) comments


With enterprise users looking to maximize the use of their data center assets, Huawei’s Chief Architect & Technical Director of IT Data Center Solutions, Bruce Su, explains how the company's six-layer active-active data center solution is eradicating the need to deploy passive, redundant data center assets.
LRTV Huawei Video Resource Center
Blue Consult & Huawei for a Better Solution

4|8|15   |   4:01   |   (0) comments


Martin Rott, CEO, and Marc Metzler, head of sales virtualization, from Germany's Blue Consult discuss their collaboration with Huawei and TrendMicro to develop a secure, scalable IT platform that can meet the needs of the most demanding enterprise users.
Upcoming Live Events
May 5, 2015, Hyatt McCormick Place, Chicago, IL
May 6, 2015, Georgia World Congress, Atlanta, GA
May 12, 2015, Grand Hyatt, Denver, CO
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 8, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 10, 2015, Chicago, IL
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
November 11-12, 2015, The Westin Peachtree Plaza, Atlanta, GA
All Upcoming Live Events
Infographics
Network Instruments, a JDSU division, shares results from its 2015 State of the Network, a global survey on security.
Hot Topics
Verizon Scores New OTT Content Deals
Mari Silbey, Independent Technology Editor, 4/16/2015
What if the Comcast Merger Fails?
Mari Silbey, Independent Technology Editor, 4/20/2015
Nokia, Alcatel-Lucent in Merger Talks
Iain Morris, News Editor, 4/14/2015
Nokia & Alcatel-Lucent: What's Going On?
Ray Le Maistre, Editor-in-chief, 4/15/2015
Nokia + AlcaLu: What the Analysts Say
Ray Le Maistre, Editor-in-chief, 4/14/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Data Center Interconnect, or DCI, is one of the hottest sectors in telecom currently. Since coming back to Light Reading last year, prodigal-son style, I've ...
LR CEO and Founder Steve Saunders sits down with the head of Qosmos to talk about the changing state of the art in deep packet inspection technology, including its role in SDN and NFV architectures.