Aereo's bankruptcy filing marks a fade to black
After months of "not dead yet" declarations, the streaming-TV startup files for Chapter 11 reorganization, the clearest sign that a Supreme Court ruling set it on a road to nowhere.
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Aereo has filed for bankruptcy protection, acknowledging that it has exhausted its viable routes to keep operating after a Supreme Court decision against it in June.
"While our team has focused its energies on exploring every path forward available to us, without that clarity, the challenges have proven too difficult to overcome," founder and Chief Executive Chet Kanojia said Friday morning in an online letter.
After a drawn-out period in which the streaming-TV startup explored possible paths for survival after the Supreme Court essentially deemed its model as illegal copyright infringement, the Chapter 11 filing casts Aereo as a company that has reached the end of the line. Aereo, emboldened early on by a string of favorable court rulings, once appeared poised to shake up the TV industry with its service that grabbed over-the-air TV signals without paying broadcasters any fees and let customers stream them for a low monthly price. But TV networks sued Aereo -- including CBS, the parent company of CNET -- and Friday's filing indicates that the media giants' fight against it has succeeded.
Although neither Aereo nor Kanojia indicated Friday what the next step after the bankruptcy reorganization would be, the executive's letter had the tenor of a farewell.
"We stayed true to our mission and we believe that we have played a significant part in pushing the conversation forward, helping force positive change in the industry for consumers," he wrote. "Thank you for all of your support...We are incredibly grateful to have gone on this journey together."
Earlier this month, Aereo laid off most of its staff, leaving just a small executive crew to manage its remaining operations.
Chapter 11 is a form of bankruptcy protection that blocks ongoing court procedures against a company's business and property, sometimes lessening litigation costs and vulnerability. It also allows a company to restructure and repay its debts and investors once it becomes clear the company no longer has the ability to continue as the business that it set out to be.
Launched in 2012 with the backing of IAC Chairman Barry Diller, Aereo's service gave subscribers control of an individual mini antenna that could capture and stream broadcast TV shows over the Internet or record them for future viewing, all for $8 to $12 a month. It stopped operating voluntarily shortly after the Supreme Court decision. Though it attempted various alternatives to resume streaming, the US Copyright Office deflected Aereo's initial attempt to operate under a different kind of copyright license, and a lower court last month issued an outright ban on Aereo's streaming-TV service while the company continued to fight the case.