Barry Diller Wants To “Transform Television” With Aereo, A DVR In The Cloud

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Barry Diller always enjoys riling the media industry from which he sprang. A few minutes ago at a press conference at IAC headquarters in New York City, Diller introduced a new startup IAC is backing called Aereo that is building a DVR in the cloud that broadcasts live TV to your iPad, computer, or TV.  Diller has always believed that Internet TV would be a healthy counterweight to “media concentration” as media companies increasingly want “to protect that closed system.”

The problem with Internet TV so far, says Diller, is that “there wasn’t a lot to watch” other than “cats swinging from chandeliers.” And other hardware solutions presented the problem of more boxes in the living room. “Who wants another remote, box, wires?” asks Diller. “Everyone already has enough of all that stuff.”

But he sees Aereo as a way “to transform television and how you receive it.” The way it works is it actually sends live broadcast TV to your computer or iPad. Aereo builds boxes the size small refrigerators with arrays of tiny TV antennas inside. Each of those antennas can be programmed to deliver broadcast video over the Internet to viewers. (One video stream per viewer at a time). And this is how the company gets around legal barriers, it is just tuning into live TV. This is a similar approach in concept to what Slingbox did, but instead of tuning into your own TV, it tunes into a TV antenna in the cloud.

The iPad app looks like a program guide with DVR functionality. So you can record any show available on the system, but only broadcast stations like ABC, NBC, and FOX are available at launch. Cable channels aren’t available. The other limitation is that the service will be capacity constrained. It needs one tiny antenna per user in order to stream TV to them.

Aereo is launching live today in New York City. The service is invite only and will cost $12 a month for a virtual DVR with a dual tuner and 40 hours of storage.