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Fox Exec Backs Threat to Kill Signal, Says Affiliates 'On Board


"To serve our community, we need to protect our product and revenue streams."

LAS VEGAS (TheBlaze/AP) -- Television stations that relay Fox programming are "on board" with a threat to transition the over-the-air network to cable and satellite TV if Internet startup Aereo keeps reselling Fox's signal without paying for rights, the chairman of a Fox group said Tuesday.

Fox's parent company, News Corp., owns just 27 of the 205 stations that carry Fox shows such as "The Simpsons" and "Fringe." The rest are affiliates that are independently owned or are part of chains of station owners. Steve Pruett, the chairman of the Fox affiliate board of governors, spoke about the stations' support in an interview with The Associated Press on Tuesday at the annual gathering of broadcasters, the NAB Show.

Chase Carey, the chief operating officer of News Corp., raised the threat Monday amid a legal battle with Aereo. Carey said that if courts can't stop Aereo from taking its signals for free and reselling them to customers, the company would have to make Fox a subscription-only network.

Haim Saban, chairman of the Spanish-language Univision network, echoed Carey's sentiment.

"To serve our community, we need to protect our product and revenue streams, and therefore we too are considering all of our options -- including converting to pay TV," Saban said in a statement.

Pruett said that Fox TV stations could send out two signals -- one to cable and satellite providers and another out over the free airwaves. Premium Fox programs could be reserved for paying customers, while the free-to-air broadcasts could be of lesser quality. Pruett said it was too early to go into details.

"We are completely on board with Chase's statement," Pruett said. "We are joined at the hip, so to speak."

Currently, anyone with an antenna can pick up a TV station's signals for free. But cable and satellite companies typically pay stations and networks for the right to distribute their programming to subscribers. Industrywide, those retransmission fees added up to $3 billion last year and are expected to double by 2018, according to research firm SNL Kagan.

Last week, that business was shaken after the 2nd U.S. Circuit Court of Appeals in New York issued a preliminary ruling siding with Aereo, which contends that it doesn't have to pay those fees because it relies on thousands of tiny antennas personalized to each customer. It argues its service, starting at $8 a month, is similar to individuals using their own antennas and digital video recorders.

In a separate case, broadcasters are suing a different Internet company called Aereokiller LLC. It also takes broadcast signals using mini antennas and transmits them to paying customers. That case is now before the 9th U.S. Circuit Court of Appeals in San Francisco. Broadcasters hope that a different ruling there will result in the U.S. Supreme Court taking over the matter.



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