Aereo receives $34m boost

Controversial US online TV service Aereo has raised US$34m in new investment, with veteran media backer Gordon Crawford contributing, despite ongoing wrangles over its legitimacy.

The New York-based service allows subscribers in 10 US cities to watch TV channels on mobile devices using a personal antenna but does not pay licence fees to broadcasters, unlike pay TV operators like Cablevision and Comcast.

The company is pressing ahead with plans to launch in new US cities later this month.

The financing of that expansion has now been helped by the cash injection from Crawford, who retired after 41 years with Capital Research in 2012. He has previously invested heavily in Time Warner, Liberty Media, News Corp, Comcast and DirecTV during their early days.

China’s Himalaya Capital Management is also providing funding, joining former Fox Broadcasting CEO Barry Diller who has backed the venture since it launched in 2012, investing US$20.5m of his own money.

But Aereo’s delivery method has brought allegations of copyright theft from the main broadcast networks ABC, NBC, Fox and CBS and the Supreme Court is due to rule on the legality of the service on January 10.

In a statement released in December Aereo said it welcomed the chance to end the legal wrangle once and for all in its favour, saying a consumer’s right to use an antenna to access the over-the-air television is protected by congress.

It has previously won smaller court battles in New York and Boston.

Alex Moulle-Berteaux, chief commercial officer at Aereo, told C21 that the focus for 2014 would be geographical and technological expansion, but would mainly be focused on the US rather than international initially despite the involvement of the Chinese investors.

He said: “Scaling, keeping up with growth, is our key challenge. We’re a browser-based application on IOS so we’re excited about starting on a native application for iOS. We think about native development as a big opportunity for us.

“We’re seeing quite a bit of interest internationally, but at least for the next 12 months we’re focusing on our geographic expansion in the US. Scaling to meet demand is 110% of our energy and effort at the moment.”