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DirecTV, TWC, and Charter Reportedly Learning from Aereo

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The other shoe is about to drop. Broadcast television's battle with upstart Aereo has less to do with what Aereo offers than what it could lead to. Aereo captures over-the-air signals and streams them online to subscribers. It does this without the broadcaster's permission and it doesn't pay retransmission fees. Cable and satellite networks, however, do pay retransmission fees, and lots of them. According to Bloomberg News, U.S. retransmission fees will total $3.01 billion this year, a total expected to double to $6.1 billion by 2018. CBS is expected to get 24 percent of its cash flow from retransmission fees by 2015, reports Deadline.com.

If the courts allow Aereo to capture over-the-air signals for free, and so far they have, there's no reason that the pay TV industry can't do the same thing. Now, reports have come out that DirecTV, Time Warner Cable, and Charter Communications are considering capturing over-the-air signals like Aereo does and skipping out on retransmission fees. If this happens, expect to see major changes from broadcasters, with some networks and popular shows moving to cable. Fox has already said that its broadcast network will move to cable if Aereo continues.

"If the story is true, this deal would demonstrate a step in the right direction for some of the entrenched players, albeit one that seems more motivated by the financials, versus the benefit to consumers," says Brian Kane, COO of video advertising platform LiveRail.

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