Does Aereo actually have a Plan B?


Fortune’s Dan Primack gleaned some interesting insights during an interview with Aereo chief executive Chet Kanojia on Friday.

Primack reported today about his sense that Aereo, a live TV-on-the-Web service, may still pivot if it loses its battle with TV broadcasters in the US Supreme Court (a decision could come any day now).

Kanojia has said that the company doesn’t have a backup plan if it loses, and media mogul Barry Diller, a major Aereo investor, has said a ruling against the company would spell the end of the service.

But is that really true? Aereo has raised nearly $100 million in venture capital, after all. Kanojia, Primack wrote, “reiterated his optimism and lack of an action plan in case it’s misplaced.” Still:

At the same time, however, he also suggested that Aereo could explore several alternate options in the case of a loss, including perhaps even paying some sort of retransmission fees to broadcasters. In other words, he’s at least given passing thought to a Plan B, without having actually formulated one.

In his Term Sheet newsletter, Primack added that Kanojia “did suggest that he made enough money off his last startup (sold to Microsoft) that he wouldn’t want to do something that just ekes out a few more bucks [from Aereo]. In short, there still could be an Aereo pivot of sorts if the Supreme Court effectively requires it.”

Additionally, in the Term Sheet newsletter, Primack also offered a look back at Kanojia’s initial dealings with Highland Capital and FirstMark Capital around raising a seed round for Aereo:

Kanojia told Highland and FirstMark that they should internally value the company at zero, adding: “I told them that it’s either going to be worth nothing, or it’s going to be the single most successful investment they’ve ever made.”

The company charges subscribers $8 a month to get over-the-air television shows they can stream anytime to their computers and mobile devices. Available in 11 cities, including Boston, Aereo includes a remotely accessed DVR service. 

Engineering for the service all took place at Aereo’s office in the South Boston Innovation District, which has 80 employees. The company has a smaller staff at its headquarters in New York City.

For the full background on Aereo, check out my story in Sunday’s Boston Globe Game Changers magazine, Scott Helman’s recent profile in the Globe magazine, as well as our past coverage on BetaBoston. And stay tuned for a decision from the Supreme Court.

Kyle Alspach has worked in journalism in Massachusetts since 2005 and was one of the original staff writers at BetaBoston.
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