Friday morning it was announced that TiVo has been granted permission by a Bankruptcy Court Judge to purchase a majority of Aereo’s assets. This ruling comes three months after Aereo filed for bankruptcy and six months after the Supreme Court decided that the media streaming startup was offering a service too similar to that of regular cable television to be treated differently. This decision by the Supreme Court rendered Aereo crippled and looking to scrap its parts for money.
Tivo purchased Aereo’s customer lists, names, and some trademarks for $1 million. Patent risk management company RPX Corp bought the company’s patent portfolio for $225,000 while Alliance Technology Solutions is expected to pay $300,000 for Aereo’s equipment. This is good news for the company that has been stalled in Bankruptcy Court but Aereo’s counsel has told GigOm, “[w]e are very disappointed with the results of the auction” and that “[t]his has been a very difficult sales process and the results reflect that.” The company was expecting much more than the $2 million it received. Aereo had raised about $97 million from outside fundraising just before its doors were forced shut.
Aereo’s approval for sale by the Bankruptcy Court has allowed the company to redefine itself. The company was renting antennas to its customers who were then able to stream local channels via Aereo’s web-based service while using hosted DVR space. This service was being provided to their customers for about $8 per month. Providing this service for such a low price made the much more expensive cable servicers much less appealing. This was especially true because many who used the service were able to stream shows in real-time as they were being televised on regular cable.
TiVo is rather pleased with the acquisition of Aereo’s assets. The President and CEO of TiVo, Tom Rogers, in a press released said “TiVo has always innovated to meet the constantly changing ways TV audiences choose to access content.” This press release by TiVo included statements about their future business strategies that fell within the meaning of the Private Securities Litigation Reform Act of 1995. The client list and trademarks obtained by TiVo from Aereo will allow TiVo to target a larger audience as well as to explore the incorporation of media streaming via antennas into their very inclusive service package.
With regards to the assets purchased Rogers went on to say that “TiVo has found success in providing a more comprehensive offering and sophisticated user experience than any other player in the marketplace and we look forward to expanding on that success.” Many are expressing the opinion that this was a very smart strategic buy on behalf of TiVo.
While Aereo is now finally able to move forward after the Bankruptcy Court has allowed other entities to purchase its different parts, it may be TiVo who has come out on top. The innovations Aereo made in broadcasting, although rendered illegal by the Supreme Court, may still find a niche within the industry in coming years if TiVo moves ahead with offering a similar service in its consumer package.
By Joel Wickwire
Photo by Jamie McCaffrey – Flickr License
Photo by Raffaele Esposito – Flickr License