Broadcast networks are facing a classic game of Whac-A-Mole in their efforts to stamp out streaming service Aereo.
The nation’s highest court will hear arguments on Tuesday over whether Barry Diller’s two-year-old TV startup is stealing their programming and re-transmitting it to Aereo subscribers.
Diller, who launched Aereo on Valentine’s Day in 2012, has said publicly that the service is “finished” if it loses the Supreme Court case — but industry observers say it might not matter.
“We believe it will only be a matter of months before some new Aereo-like service emerges with a work-around specifically designed to adhere to the court ruling and the process starts all over again,” Bernstein analyst Todd Juenger wrote in a recent report.
There are already Aereo knockoffs plotting their next moves.
Alki David, who operates a similar antenna-based service called FilmOn, says that if Aereo wins he’s going to expand his local TV offering immediately.
“We’re in 18 cities and our model is free,” he told The Post. “We’d turn on all over the States and have a far bigger slice of the market than Aereo.”
And if Aereo loses?
“We lose maybe 5 percent of our revenue,” said David. That represents ad revenue FilmOn sells against local TV channels.
In addition to broadcast TV, FilmOn, which is ad-supported, also offers movies and other content that won’t be affected by the Supreme Court decision.
New York-based Aereo charges $8 a month to allow subscribers to watch broadcast TV programs on their computer, tablet or smart phone via the Internet.
The service, which is available in 11 cities including New York, works by capturing live broadcast TV signals and retransmitting them using tiny antennas.
FilmOn has taken the antenna idea a step further, adding remote desktop access that lets Boston residents watch local TV broadcasts from New York.
Major broadcasters — including CBS, NBC, ABC and Fox — argue that Aereo’s business model is a violation of the 1976 copyright law that prohibits public performance.
Aereo claims that it is under no obligation to pay for free-of-charge programming that is available over the public airwaves.
Both Aereo and the broadcasters asked the Supreme Court to weigh in after legal skirmishes in lower courts failed to settle the issue.
Broadcasters initially sued Aereo in 2012, seeking a preliminary injunction. It was denied in federal court in New York and on appeal. A Massachusetts federal court also denied an injunction, but a Utah federal court granted one.
FilmOn, which changed its name from Aereokiller after it got into a trademark dispute with Aereo, was also sued by a group of broadcasters in California last year.
The federal court judge in that case issued a preliminary injunction against the company but limited the scope to his district, prompting the broadcasters to bring additional suits elsewhere.
The Supreme Court is expected to issue a ruling in late June or July.
If the highest court finds Aereo is legal, as several lower courts have, then cable and satellite companies that currently pay hefty retransmission fees to broadcasters might stop paying and set up Aereo-like systems instead.
Those include Comcast, the nation’s No. 1 cable provider, and satellite company DirecTV, which, according to David, tried to acquire FilmOn in anticipation of an Aereo win.
“They made an offer to buy us, and we declined,” David told The Post.
DirecTV declined to comment.