Aereo gains approval to sell off assets
DetailsMichelle Clancy | 03 January 2015
After working out a deal with broadcasters looking to block the sale of its assets, online video startup Aereo has been given the go-ahead from the federal bankruptcy court to proceed with the liquidation.
Aereo has about $20.5 million in assets, but a cash base of only $3.6 million, meaning that the sale will be critical for the company’s backers.
Broadcasters, including ABC, CBS, FOX and NBC, were given a say in the auction process; they can oppose any sale that they think will allow Aereo to rise from the ashes, and can provide input on things like when it will scrub their servers. And, they can attend the auction, scheduled to take place in February.
"It's no wonder the same broadcasters who sued Aereo have been raising concerns in bankruptcy court that potential buyers of Aereo's technology could use it against them and once again infringe their copyrights," Shalini Ramachandran wrote in the Wall Street Journal.
Aereo CEO Chet Kanojia told Bloomberg Television back in November that while non-disclosure agreements prevented him from naming specific companies they were negotiating with, "there was a lot of interest — and still is — in buying the company and buying the assets of the company". He said that these include companies in the Fortune 500 that are already known for providing video.
Aereo is looking to sell its physical assets and intellectual property after filing Chapter 11 in the wake of a high profile legal flame-out.
Aereo has been shut down since the end of June when the US Supreme Court found the company in violation of copyright law for retransmitting local TV station feeds over the Internet without paying for the content. Aereo had counter-argued that because it provided dime-sized antennae to its subscribers — who paid $8 per month for access to a couple dozen channels — it should be considered an over-the-air, rabbit ears-based service, which is exempt from retrans fees. It also argued that its content was delivered to a single cloud-based DVR device for one subscriber and could therefore not be categorised as a public broadcast service, subject to fees and regulations.