Aereo Revises Pricing Plans for Over-the-Air

Legally embattled Internet TV startup now offers two service tiers

Internet TV startup Aereo, which broadcasters accuse of illegally poaching their TV signals, is streamlining pricing options to just two plans and scrapping the apparently unpopular per-day and annual options.

Aereo is keeping the base plan of $8 per month, which includes 20 hours of DVR storage, and the $12 monthly option which triples DVR storage to 60 hours (previously 40).

Aereo has not disclosed how many paying subscribers it has signed up in New York. The startup is expanding into Boston, with an invite-only period starting May 15, and expects to roll out to another 21 other U.S. markets later in the year.

Broadcasters have been trying to shut down Aereo, whose major backer is IAC chairman Barry Diller, since it launched in New York City last spring. The company claims it’s simply facilitating Americans’ right to free over-the-air TV, hosting teeny-tiny antennas at its data centers and slinging live and recorded video to users’ devices.

Separately, ABC this week will introduce “Watch ABC” mobile apps for streaming live local TV in select markets on tablets and smartphones. However, the service will require users to have a pay-TV subscription with a participating cable or satellite provider.

Last year, ABC, CBS, Fox, NBC, Univision and other broadcasters have filed copyright-infringement lawsuits against Aereo, claiming the company must pay retransmission fees the way cable and satellite TV providers do. So far, judges in the U.S. 2nd Circuit Court of Appeals have twice ruled against broadcasters’ requests for injunctions that would put the kibosh on Aereo, which is pre-emptively seeking a ruling ahead of its launch in Boston that the service is legal.

The case appears headed for the U.S. Supreme Court, given that an identical Internet streaming service — calling itself Aereokiller — was ruled illegal by the 9th Circuit last December. Broadcasters, trying to get Congress’ attention, have threatened to convert free over-the-air TV to cable channels if Aereo ultimately prevails.

With the new pricing structure, Aereo is dropping its “Try for Free” one-free-hour-per-day offer. Execs had touted that move as serving the public interest, by providing live news, during weather-related emergencies.

However, new Aereo customers will receive their first month of membership for free. The new pricing plans will go into effect on May 15.

“We looked at our data and it was clear, consumers want a more simple approach to pricing,” Aereo topper Chet Kanojia said in announcing the plans.

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