Light Reading

Aereo Plans Faster Growth Amid Legal Drama

Alan Breznick
1/9/2014
50%
50%
Repost This

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
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.   
Flash Poll
LRTV Documentaries
Cable Eyes Big Technology Shifts

4|16|14   |   03:02   |   (3) comments


US cable engineers are facing a lot of heavy lifting in the coming years, notes Light Reading Cable/Video Practice Leader Alan Breznick.
LRTV Custom TV
Maximizing Customer Experience & Assuring Service Delivery in an IP World

4|15|14   |   4:57   |   (0) comments


Steven Shalita, VP of Marketing, NetScout Systems, Inc., discusses the challenges cable/MSO operators face in assuring the delivery of new IP-based services. Key points include the value of proactively managing performance, and using rich analytics and operational intelligence to better understand service and usage trends, make smarter business decisions and ...
LRTV Documentaries
Bye-Bye DVD: Consumers Embrace Digital Video

4|10|14   |   04:17   |   (6) comments


Veteran video analyst Colin Dixon, founder and principal analyst of nScreenMedia, says research shows 56% are using digital video already.
LRTV Documentaries
Video: TW Cable Puts Multicast Gateways to the Test

4|8|14   |   04:13   |   (1) comment


Tom Gonder, a chief architect at Time Warner Cable, explains how its trial of multicast gateways is impacting IP-based video plans.
LRTV Custom TV
Managing & Monetizing Big Data in Operator Environments

4|7|14   |     |   (1) comment


At Mobile World Congress, Gigamon's Director of Service Provider Solutions, Andy Huckridge, and Heavy Reading Analyst Sarah Wallace discuss the 'big data' issues facing carriers and operators today.
LRTV Huawei Video Resource Center
Data Center Energy – Build Your Data Center in a Modular Way

4|7|14   |   2:13   |   (0) comments


Dr. Fang Liangzhou, VP Network Energy Product Line, shared his thoughts about the challenges for data centers during CeBIT 2014.
LRTV Huawei Video Resource Center
Agile Network Solution – An Overview of Huawei's Agile Network Solution

4|7|14   |   2:31   |   (0) comments


Ajay Gupta, Director of Product Marketing, Networking Product Line, gives an overview of the Agile Network Solutions during CeBIT 2014.
LRTV Huawei Video Resource Center
Huawei’s eLTE Voice Trunking, Video and Data Applied for Railways

4|7|14   |   1:38   |   (0) comments


Gottfried Winter is the Sales Director at Funkwerk, a German specialist in GSM-r terminals and a long-time partner of Huawei. At CeBIT 2014, Winter talks to Light Reading about this partnership and the integration of enhanced voice trunking, video and data functions.
LRTV Huawei Video Resource Center
LeaseWeb Speaks Highly of Huawei's Datacenter Products

4|7|14   |   1:37   |   (0) comments


Rene Olde Olthof, Operations Director LeaseWeb, talks about the next data center transformation during CeBIT 2014.
LRTV Documentaries
Comcast: Reshaping the Cable Network Architecture

4|3|14   |   07:11   |   (8) comments


Shamim Akhtar, Comcast's architect and senior director of network strategy, explains why the cable company is moving to a more distributed network architecture.
LRTV Custom TV
VMware CEO Pat Gelsinger at Mobile World Congress

4|1|14   |   3:41   |   (0) comments


VMware CEO Pat Gelsinger speaks to Heavy Reading about the value of virtualization spanning from the data center to service provider networks to mobile devices.
LRTV Huawei Video Resource Center
Analysts' Impressions of Huawei SoftCOM at ONS 2014

4|1|14   |   1:11   |   (0) comments


After visiting the Huawei booth at ONS, Lee Doyle of Doyle Research gives his appraisal of Huawei's SoftCOM solution.
Hot Topics
BlackBerry's Chen: We're Not Dumping Devices
Dan Jones, Mobile Editor, 4/10/2014
AT&T's Going to Carolina With 1 Gig
Sarah Reedy, Senior Editor, 4/10/2014
Cisco, Juniper Treating Gear Against Potential Heartbleed
Dan O'Shea, Managing Editor, 4/11/2014
Cisco & VMware Are Apple & Google of SDN
Mitch Wagner, West Coast Bureau Chief, Light Reading, 4/14/2014
T-Mobile Petitions Operators to Kill Overages
Sarah Reedy, Senior Editor, 4/14/2014
Like Us on Facebook
Twitter Feed