As the Supreme Court's April 22 review of broadcasters' case against Aereo approaches, Chet Kanojia, founder and CEO of the embattled online video service, warned that the consequences of a finding for the broadcasters would have "chilling" consequences for consumers and the cloud services industry.
"The long-standing landmark Second Circuit decision in Cablevision has served as a crucial underpinning to the cloud computing and cloud storage industry," Kanojia said in a statement released late Wednesday. "The broadcasters have made clear they are using Aereo as a proxy to attack Cablevision (NYSE: CVC) itself. A decision against Aereo would upend and cripple the entire cloud industry."
Kanojia also contended in the statement that broadcasters are opposing the use of equipment that is already lawful to use, just "more modern-day" than traditional antennas and DVRs. Aereo rents dime-sized antennas and a cloud-based DVR to subscribers, who only need to have a viewing device, such as a computer, tablet or smartphone with Wi-Fi access, to view broadcast programming through Aereo's website or mobile app.
"They are asking the Court to confine consumers to outdated equipment and limit their access to lawful technology in order to protect a legacy business model, the success of which is built on eliminating consumer choice and competition in the marketplace," he said.
Aereo filed a response brief with the Supreme Court on Wednesday, and amicus briefs in support of Aereo will be filed April 2.
Kanojia, probably not coincidentally, will speak the same day at the ACA Summit in Washington, D.C. The American Cable Association represents smaller cable companies who, according to CEO Matt Polka, "care just as deeply as he does about freedom to innovate and share his frustration with broadcast incumbents that refuse to embrace the digital revolution."
While Kanojia affirmed that he and the company are confident the Supreme Court will uphold the 1982 Cablevision decision as well as the 1984 Sony Betamax decision governing recording of broadcast content (both links courtesy of the Electronic Frontier Foundation), the statement was another signal that the situation for Aereo could be grave.
Kanojia told Bloomberg TV's Jon Erlichman last week that the Court review was essentially a do-or-die situation for Aereo. "If we don't succeed, despite our best efforts and the good law being on our side, it would be a tragedy," he said.
In an e-mail to Aereo subscribers that was also posted on the company's blog, Kanojia laid out the basics of the case as the company sees it. "We think you should be able to decide whether you use home equipment or whether you take advantage of the ease, convenience and lower cost of cloud-based equipment and storage," he said.
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