Aereo may have 100K subscribers in New York – that could be trouble

Castle on Aereo TV

Aereo, the start-up that lets people watch over-the-air TV for $8/month, is giving broadcasters fits and delighting consumers looking to break free of over-priced cable bundles. But, until now, no one has been quite sure how many people are actually using the service.

Now, the Wall Street Journal reports that there are between 90,000 and 135,000 Aereo subscribers in New York City alone. This is big news because CEO Chet Kanojia has been tight-lipped about how well Aereo is doing, and has only said that the company could be profitable with a million subscribers.

Aereo did not confirm the new figures, which the Journal obtained by counting lit-up boxes in the company’s Brooklyn facilities. Here’s a screenshot of an exchange between the Journal reporter and media journalist Peter Kafka:

Screenshot re Aereo exchange

The figure shows how Aereo is catching on rapidly in New York City, even as it has been expanding to other cities, including Boston, Miami and, most recently, Detroit (the goal is to reach 22 cities by the end of the year).

While the New York growth attests to the popularity of Aereo’s service, the numbers are not all good news. First, as the Journal explains, all those new subscribers are in the Empire State, where power is expensive, and that means surging electricity bills; and, unlike cable, it is Aereo — not subscribers — who foot that bill.

The more significant downside from the new numbers, however, is that they are likely to provide new ammunition to broadcasters who are beating on the Supreme Court’s door to hear an appeal of a controversial appeals court decision that gave Aereo the green-light to operate in New York. A hearing this year appeared unlikely, since a California appeals court is still weighing the issue, but a surge in Aereo subscribers will help the broadcasters argue that they will suffer irreparable harm unless the Court stops Aereo.

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