Media General CEO George Mahoney told analysts today that "we're pleased with the way the Aereo argument went. It's terrific that the Justice Department came in on the side of broadcasters. We came away from the argument feeling better than we had and we went in feeling pretty good."
EARNINGS CALL
Mahoney Hopeful For Good Aereo Decision
Calling Aereo a “bunch of pirates,” Media General boss George Mahoney told analysts and investors today that he’s encouraged by the early signs coming out of the U.S. Supreme Court.
“We’re pleased with the way the Aereo argument went,” Mahoney said during the company’s first-quarter financial results conference call. “All broadcasters think Aero is a bunch of pirates … I don’t think anyone believes that what they have is anything but a Rube Goldberg mechanism.”
The U.S. Supreme Court recently heard arguments from Aereo, which retransmits broadcast television signals to an antenna in subscriber homes, that it doesn’t violate the U.S. Copyright Act because viewers are witnessing a “private performance,” not a public one.
Broadcasters’ counter-argument: Aereo is stealing its signals without paying compensation.
“It’s terrific that the Justice Department came in on the side of broadcasters,” Mahoney said during the call. “We came away from the argument feeling better than we had and we went in feeling pretty good.”
A Supreme Court decision on the Aereo case appears likely to come in late June or early July.
BRAND CONNECTIONS
Regarding the Media General-Young merger, Mahoney said Media General will realize an additional $10 million in operational synergies, in part from cutting 45 jobs, and may well achieve additional cost cuts.
In total Media General has realized $29 million in financial synergies from the mergier and, with the $10 million, about $25 million in operational cost savings.
Mahoney also noted that Media General is selling KRON’s headquarters building in San Francisco sooner than expected and for more than the $20 million asking price. He did not disclose the sale price.
Media General acquired KRON in the merger with Young.
Regarding the recently announced plan to combine Media General with LIN, Mahoney said Media General intends to supply regulatory agencies including the FCC and the Department of Justice with answers on how it would deal with an regulatory issues going in.
While other broadcasters, including Sinclair, have encountered speed bumps in their efforts to overcome regulatory hurdles associated with consolidation, Mahoney said their “pioneer” work may help make it easier for Media General to address regulatory concerns on the front end.
Media General hopes to close on the merger with LIN by early 2015, Mahoney said.
Comments (11)
Ellen Samrock says:
April 28, 2014 at 1:59 pm
When one of the justices asked what the difference was between Aereo and cable and why the need for all those antennas, you know the outcome can’t be good…at least not for Aereo. They say they have no plan B but it’s clearly time for Barry and Chet to get real and formulate one.
Wagner Pereira says:
April 28, 2014 at 4:16 pm
They may not need one. Suggest you look at the entire transcript and not 1 sided questions posted on websites and blogs that lean one way with their readers. Note from a person who has is Pro Broadcaster: “Supreme Court Justices appeared to understand that designing to the law was different than breaking the law” http://t.co/ujjhBT0fki
Gene Johnson says:
April 28, 2014 at 4:34 pm
I listened to the entire oral argument (thanks C-SPAN radio), and have to say that while it is dangerous to make predictions based on oral arguments, I don’t think Aereo should feel comfortable with how the argument went. Most of the justices seemed skeptical of what it is doing, with their primary concerns (justified or not) being the potential of how an adverse ruling against Aereo might affect other “new technologies,” such as cloud computing. But, those are very different services than what Aereo is doing, and a narrowly written decision should not have much impact. It is an interesting question why neither side seems to want to classify Aereo as a cable system. We know why Aereo doesn’t want that, but why broadcasters did not make or don’t make that argument is a bigger question. Justice Sotomayor’s question on the subject (the first question in the argument) was joined by Justice Breyer, and never seemed adequately answered, at least based on the statutory definition of a cable system.
Wagner Pereira says:
April 28, 2014 at 4:52 pm
Harvard Business Review: Aereo Isn’t Illegal Just Because It Threatens Broadcasters http://blogs.hbr.org/2014/04/aereo-isnt-illegal-just-because-it-threatens-broadcasters
Ellen Samrock says:
April 28, 2014 at 5:41 pm
You misunderstand. I want Aereo to succeed in some way because a win for Aereo floats all boats. LPTV and translators will benefit from the increased coverage through their subscribers. But it needs to be a win that the networks can live with which is why I strongly encourage Aereo to start a dialog or negotiation process with them. I don’t think the networks are going to yank their premium content off the air as they have been threatening to do since it would have a devastating impact their affiliates.
Wagner Pereira says:
April 28, 2014 at 7:15 pm
I am a Broadcaster through and through – but said from the beginning, I believe its legal. Aereo does not need to negotiate as they developed the system to COMPLY with existing copyright laws. The real solution is to fix the copyright laws that caused the construction of the system as it is in the first place.
Andrea Rader says:
April 28, 2014 at 9:05 pm
The “technological workaround” Aereo has devised to evade copyright laws might have bamboozled low-information jurists, but people who know how antenna and tuner technology actually works (to say nothing of physics) aren’t fooled:
http://www.tvtechnology.com/mcadams-on/0117/mcadams-on-aereo-wordplay-v-science/270111
Wagner Pereira says:
April 28, 2014 at 11:13 pm
As stated multiple times over the past 9 months, antenna are red herring. Read the copyright law and understand even if they used 1 antenna for everyone (identical to apartment complexes, condos, and businesses including hotels/motels) , it would not matter. Concentrating on the antenna makes you look foolish. SCOTUS will NOT rule on mini-antennas work or not! They are immaterial.
Andrea Rader says:
April 29, 2014 at 3:01 am
Yep, that’s why CJ Roberts specifically stated, and I quote, “There’s no technological reason for you to have 10,000 dime-sized antennas, other than to get around the copyright laws.”
Wagner Pereira says:
April 29, 2014 at 11:24 am
You do realize that if they are “get(ting) around copyright laws”, that means they are legal – because the system was devised according to the laws? Besides, 10,000 dime sized antennas mean nothing if they are feeding 1 tuner per station. As I have said literally 1,000 times here, the antennas are a red herring. Tuners are the key. They need 1 tuner per person (and of course, how would 10,000 dime sized antenna feed 1 tuner per station anyway?). They are renting tuners, not antenna. They could have 1 antenna feeding 10,000 tuners, just like hotels, motels, condos, apartments, businesses etc and be legal. If not, there is an issue. 1 tuner, like a typical MVPD, would put it in the same category as a MVPD, which according to current law, it does not fit into. Again, the problem is in the copyright law which is where the efforts to change the law should be concentrated.
Andrea Rader says:
April 28, 2014 at 4:05 pm
Aereo doesn’t have a Plan B because they can’t undercut lifeline service on cable if they have to properly compensate broadcasters for their content.