The suggestion by executives in charge of Fox and Univision that their networks would consider switching to a pay model in response to a new start-up by Fox co-founder Barry Diller is dramatic because they’ve never brought it up before. Though, it’s a bit of a stretch to call the threat an “Armageddon-like declaration that could unravel network TV.” The executives, namely Fox News president Chase Carey and Univision chairman Haim Saban, were doing a little high-profile musing at a conference of the National Association of Broadcasters about how they would handle a burgeoning threat from the start-up Aereo, backed by Barry Diller, who helped found Fox 30 years ago.
Aereo, which delivers broadcast television to mobile devices, just won a court battle against networks that claimed it was inappropriately circumventing their copyrights. The company argued successfully that, unlike a cable provider which uses a big antenna to pick up signals for many watchers, it used an individual antenna for each viewer, essentially a huge collection of rabbit ears (actually, dime-sized antennas it says sit in a warehouse in Brooklyn somewhere). Thus, Aereo avoided having to pay retransmission fees, which the Times’s Brian Stelter points out “have become a crucial second source of revenue for stations as ad losses mount.”
Carey and Saban’s suggestions that they could go to a paid model were hardly an imminent threat. “We can’t sit idly by and let someone steal our signal,” Carey said. “We like the broadcast business, and if we can affirm our rights, that is a path we prefer to pursue.” Later, Saban offered a similarly lukewarm warning: “To serve our community, we need to protect our product and revenue streams and therefore we, too, are considering all of our options — including converting to pay TV.”
One thing Fox and Univision’s vague threats have done is to get more people talking about Aereo, currently available only in the New York City area. While the network executives’ suggestions were hardly an “Armageddon-like declaration,” they would probably correspond to a tick forward on the second hand of network television’s doomsday clock.