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Aereo had fewer than 100K paying subscribers, copyright filing suggests

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Even as Aereo touched off an epic legal fight with broadcasters at the Supreme Court, it was unclear just how many people were paying to use the streaming TV service. This week, a potential clue emerged via a letter from the Copyright Office that cited Aereo’s submission of “royalty and filing fees totaling $5,310.74” for the period of January 1, 2012 until December 31, 2013.

Update: Other documents, reported on Monday, show that Aereo had 77,596 subscribers, spread out among 10 cities, including 27,000 in New York and 10,000 in Atlanta.

The letter appeared on Thursday, and came in response to Aereo’s application to pay cable royalties under the Copyright Act’s statutory licensing rules.

The $5,310 number is significant because it represents a percentage of total revenue during the period for Aereo, which shut its service last month in response to a Supreme Court ruling. On Twitter, law professor Bruce Boyden suggested that the number reflected subscriber revenues of around $1 million for the period:

Boyden’s figure is an estimate, but it appears consistent with the numbers set out in Section 111 of the Copyright Act (which sets out rates ranging from 0.33 to 1.064 percent of a cable provider’s gross receipts).

And, as the Hollywood Reporter’s Eriq Gardner noted, that $1 million figure in turn provides a proxy for the number of Aereo subscribers.

Since Aereo’s basic subscription was $8/month, or about $100 a year, it appears unlikely that the company, which was operating in New York and a dozen other cities, had more than 100,000 paying subscribers. (The $1 million figure represents total revenue for nearly two years so, even if all that revenue came from 2013, that would be equivalent to the annual payments of only 10,000 people).

Of course, there are some big caveats here: we don’t know, for instance, how quickly Aereo was adding subscribers, including in 2014 when the service expanded to more cities and began receiving a flood of media attention. Likewise, the revenue figure is not an exact proxy for Aereo’s popularity since, in many cases, multiple people would have shared one account. Also, the revenue figure does not reflect Aereo’s future potential since the company likely held back on expansion and marketing pending the outcome of its court case.

That said, the apparently low number is perhaps remarkable given the sky-is-falling reaction that Aereo engendered in TV industry circles. Aereo declined to comment.

There have been other guesses at Aereo’s numbers. In October of 2013, the Wall Street Journal estimated Aereo’s subscribers by counting lit boxes at its Brooklyn facility. The Journal guessed that Aereo had 100,000 subscribers in New York alone, thought that was never confirmed and was higher than what others in the industry had speculated.

For now, Aereo’s future is highly uncertain as it tries to navigate its legal status before the Copyright Office and the courts. The next significant milestone may come this month when a New York judge is expected to rule on how an injunction should apply to Aereo.

This story was updated on Monday at 7:20pm ET with the new figures.

4 Responses to “Aereo had fewer than 100K paying subscribers, copyright filing suggests”

  1. Mike Land

    It was like the Kodak instant camera. It was the best instant of the two available at the time. None of the icky chemicals that you find in a Polaroid print. You could cut and trim the photo just like a regular developed print. it was a superior product. But Polaroid’s patent suit prevailed and Kodak had to destroy them, thus riding the world of the best instant system ever developed. Did Polaroid pick up and use the system themselves? No, they continued with the inferior product and it eventually failed.

  2. I don’t get the significance of the “fewer than 100k” number either. They were barely getting started. I live on the west coast and had been anticipating their launch in my city for a long, long time. But, they never made it. If Aereo had been given a chance to succeed, they would probably have millions of customers within a few years.

  3. Keith Hawn

    Not sure why the (alleged?) low number for Aereo subs is “remarkable” – cord cutters tend to be of the loud mouth persuasion, but not so risky in placing their limited bets. Netflix? sure. Then add Aereo? nah. But they’ll natter on all day about how great Aereo is….

    • Thanks for the comment, Keith. I’m not sure cord-cutters are any more loud-mouth than anyone else, though it’s true that it can be easier to embrace something in theory than practice. For my part, though, I can say I subscribed to Aereo (and miss it)