Free for a Fee

Aereo went back and argued that if it was so much like a cable system, it should be allowed to pay the same (low) royalty rates that the cable industry pays. The courts rejected that argument, though. Aereo looked too much like a cable system to have access to free OTA transmissions, but apparently not enough like one to get the state-mandated royalty rates that cable providers pay.

FilmOn CEO Alki David brashly created an Aereo competitor with his own tiny antennas in 2012, even calling it AereoKiller at first. But whereas Aereo and its predecessors had lost their battles to be defined as a “cable system,” FilmOn managed to pull out a win in a Los Angeles federal court in 2015, when US District Judge George Wu ruled that the company should be allowed to carry on with its business if it paid the compulsory licensing rate. (FilmOn also rebranded as FilmOn X and dropped the small antennas strategy following Aereo’s loss.) Wu acknowledged his decision was in conflict with other district courts, as well as the 2nd Circuit appeals court. So he allowed the TV networks fighting FilmOn to immediately appeal to the 9th Circuit.