Diller Says Aereo Will Expand to Most Large U.S. Cities

Aereo Inc., the online television service backed by Barry Diller, will expand from New York to other large U.S. cities following a favorable court ruling, the 70-year-old billionaire said.

“We’re going to really start marketing,” Diller said yesterday in a Bloomberg Television interview in Sun Valley, Idaho, where he was attending the Allen & Co. annual retreat. “Within a year and a half, certainly by ’13, we’ll be in most major” markets.

A U.S. district judge this week allowed Aereo to continue operating while television networks pursue a copyright lawsuit against the company. Aereo captures broadcast signals with small antennas and streams them to devices such as Apple Inc. (AAPL)’s iPad, without paying for the programming.

“The ability for consumers to receive broadcast over the air signal is their right,” Diller said.

The ruling could upend the economics of broadcast television. CBS Corp. (CBS)’s CBS, Comcast Corp. (CMCSA)’s NBC, News Corp. (NWSA)’s Fox and Walt Disney Co. (DIS)’s ABC -- all plaintiffs to the lawsuit - - receive “retransmission consent fees” from pay-TV operators such as Time Warner Cable Inc. (TWC) for the right to rebroadcast the free-to-air signals to their subscribers.

Photographer: David Paul Morris/Bloomberg

Barry Diller, chairman of SAC/InterActiveCorp., arrives for the morning session at the Allen & Co. Media and Technology Conference in Sun Valley, Idaho, on July 12, 2012. Close

Barry Diller, chairman of SAC/InterActiveCorp., arrives for the morning session at the... Read More

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Photographer: David Paul Morris/Bloomberg

Barry Diller, chairman of SAC/InterActiveCorp., arrives for the morning session at the Allen & Co. Media and Technology Conference in Sun Valley, Idaho, on July 12, 2012.

“One of my friends at a large broadcaster said you succeeded in dropping my stock 2 percent,” Diller said, without naming the broadcaster. “I did think we were on the right side of this, and I’m happy the judge agreed with us.”

Executives of all the major broadcast networks are attending Sun Valley.

The cases are American Broadcasting Cos. v. Aereo , 12-01540, and WNET v. Aereo, 12-01543 , U.S. District Court, Southern District of New York (Manhattan).

To contact the reporters on this story: Edmund Lee in New York at elee310@bloomberg.net; Jonathan Erlichman in New York at jerlichman1@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net; Nick Turner at nturner7@bloomberg.net

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