There are a lot of reasons to care about the Supreme Court showdown over Aereo — 3.3 billion to be exact.
That’s how much the major broadcast networks pocket in so-called retransmission fees from charging cable and satellite companies to carry their local TV signals.
Aereo’s business model jeopardizes that growing cash pile, which is expected to hit $7.6 billion by 2019, according to SNL Kagan.
The startup, backed by Barry Diller’s IAC/InteractiveCorp, doesn’t pay for local broadcast signals and argues it shouldn’t have to pony up for what is currently free to the public.
Broadcasters fear that pay-TV providers will arrive at the same conclusion and come up with Aereo-like workarounds if they lose their case.
Of course, Aereo could simply pay broadcasters retrans fees to make the case go away, but Diller said that would render his business model moot.
“We could probably pay retransmission consent dollars if we could make a deal, we probably could, but the value proposition would go out of the game,” he told Bloomberg TV last week.
Retrans fees, which have been at the heart of blackout battles between broadcasters and cable companies in recent years, are relatively new but increasingly important.
They were born out of the recession and the brutal ad slump.