BY DAVID ZAX | 05-25-2012 | 8:51 AM
"Chet Kanojia is the CEO of Aereo, a Barry Diller-backed, TV-in-your-browser platform that launched in mid-March in a limited New York City release. For $12 a month, Aereo allows its users to watch live broadcast TV on any Apple device of their choosing (plus Roku), in high-definition. Users can also make DVR recordings that are stored in the cloud. I’ve sampled the beautifully-designed service, whose user interface offers just about the cleanest online TV experience imaginable. For now, Aereo is limited to basic over-the-air TV: no cable options yet.
At launch, Aereo was immediately beset by legal challenges from the New York media companies whose content Aereo redistributes. (How exactly Aereo does so is fascinating, and involves lots of dime-sized antennae stored somewhere in Brooklyn.) Earlier this week, a judge dismissed one of the claims of the lawsuit, but two claims of copyright infringement remain. On Wednesday, Public Knowledge and the Electronic Frontier Foundation filed friend-of-the-court briefs arguing in Aereo’s favor. We caught up with Kanojia to talk about his disruptive technology.
FAST COMPANY: In the age of Netflix and Hulu Plus, consumers seem to expect about a $9-a-month price point for online TV. Why should they pay you $12 a month for content they could potentially get for free?
CHET KANOJIA: Simplicity and convenience. When you get it free and over the air, you don’t get a DVR, and you don’t get the ability to place-shift. You’d have to get a device like Tivo, plus a Slingbox, and it’s cumbersome and complicated. But I’d love people to do that more and more. The more people that understand that this highly compelling content is right there for free, the better it is for us. You’ve been trained by the cable companies to buy the whole thing at once, whether you watch it or not. Now it’s time to start trying to take a stand.
FC: How did you choose the $12 price point?
CK: Um, we made it up... That’s a half-true answer. These are early days, and we just put something out there that we would like to get some reactions to. From a value perspective, if you called a cable company today and said, “I just want over-the-air channels in HD and the ability to place-shift," it’d be $75 or more per month. Just a DVR box is $18 a month with tax. My belief on this whole thing, and it’s a subtle but important point, is that what we are doing is the dislocation of the packaging of technology with content. We’re purely technology; we’re not making you buy a package. That dislocation has a really interesting side effect, because the cost curves of technology only come down. As we drive the cost curves down, you may see us do things that are very innovative in terms of pricing..."
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