The announcement of suspending operations is the aftermath of a Supreme Court ruling on Wednesday stating that Aereo was violating copyright law by streaming broadcast television signals to subscribers without paying for them.
Smoke and mirrors technology?
Aereo claimed they were using a new technology to create smart cloud-based television antenna arrays filled with thousands of mini TV antennas.
Every user was issued an antenna, but they only needed an Aereo compatible device which could use their web based interface to use the service. The recorded or live broadcast was streamed over the Internet to a compatible device.
Broadcast signals owned by the major broadcast television networks are transmitted through the air free of charge to anyone with a television and an antenna. Aereo claimed they were simply selling an intelligent antenna system to receive broadcast signals that were otherwise free. Aereo argued that the fees paid for the use of the equipment, not for the use of the broadcast signals.
Cable companies like Comcast and Time Warner pay the television networks billions of dollars in fees for the right to re-broadcast the network TV channels as part of paid cable packages.
What did Aereo expect?
Regardless of how they pitched it, the end result still sounded like cable TV, a system where multiple subscribers share an antenna system for improved television service.
The Supreme Count did not buy into the Aereo smoke and mirrors technology pitch that they were just leasing hardware.