that is a different case. aereo's-- the entire american public can get access to that particular antenna as long as they pay aereo's subscription fee. they say they are not going to transmit the signal until the consumer demands it, it is private use. senseis private in the that the individual consumer is using it. when you have billions of consumers using it, the idea that it is private is just -- >> how is that different from millions of people buying antennas? >> if you put an antenna on your wrist and use it to pipe the signal of a basketball game, no one thinks that violates the copyright law. wrote6, when congress this law, they said if you are watching it in your home with friends and family, they went through and defined this. they said that is not a copyright violation. what makes it a violation is taking that antenna, getting the broadcast, and making it available to the public. if you put that antenna on your roof, pipe the signal in your home, and sell it to your neighborhood, that violates the copyright l

that is what aereo is. antennareo is an service, why can i not buy the antenna and attach it to my tablet? they are small. why must i read one and provide a service the to you -- fee to you? >> there are plenty of antennas you can plug into your ipad. there is no restriction. i have a picture on my iphone from staples, there is an antennae you can buy and put on your device. absolutely, that exists. for this to be about how long the wire is does not make sense. the reason you are paying aereo is because we are integrating the entire technology, providing anddvr, consuming power bandwidth on your behalf, which are ongoing expenses, so it makes sense for us to charge you on an ongoing basis because we are taking care of all of those things. you no longer have to maintain the equip and as a consumer. we do. >> the broadcasters would contend it is not the antenna technology that raises the legal question, but the service you offer with aereo. the question becomes, as you say, you are leasing the antenna to consu

it is a hard case to prove before aereo. of the people that we talked with this morning said that it is very hard for aereo to say we should be able to get off the retransmission these signals without having to pay for them while there was president by satellite companies and cable providers that they have to pay billions of dollars for that content. >> plenty of the biggest technology companies today disrupted the traditional established industry. are there any disruptors out there that we should be watching when it comes to the cable business? >> there are quite a few. we talk about cord cutting, over-the-top tv. there are temptations. that is really important. for gaming on the tablets, on the smartphone -- you have so many things you can do at home. tv is not the dominant i marry medium for entertainment. -- primary medium for an attainment. -- for entertainment. tv content is in great shape. more people buying more content and more content is being made, but the distribution methods are heading towards destruction. >> y

chief justice, and may it please the court -- aereo's business model is to enable thousands of paying strangers to watch live tv online. aereo's legal argument is that it can make all of that happen without publicly performing. but congress passed a statute that squarely forecloses that rather counterintuitive submission. because although the internet and the thousands of mini antennas are new, the basic service that aereo is providing is not materially different from the service provided by the cable company before this court in 1969. >> why aren't they cable companies? >> they're not -- >> i'm looking at -- everybody's been arguing this case as if for sure they're not. but i look at the definition of a cable company, and it seems to fit. a facility located in any state. they've got a, whatever they have a warehouse or a building in brooklyn, that receives signal transmissions or programs broadcast by television broadcast stations. they're taking the signals off of the -- >> they're taking the signals, right. >> i'm sorry, they are. makes secondary transmissions by wires, cables, or

aereo is an equipment provider. nothing happens on aereo's equipment until a user initiates the system. the user initiates the system by logging on and pressing this is the program that i want to watch. that then tunes the antenna, activates the recording that will be made, and then the user is then able to play back that recording. justice sotomayor: i always thought, and i'll try to be careful about it, but not often enough, probably breach it like every other member of the public, that if i take a phonograph of a record and duplicate it a million times the way you're doing it, and i then go out and sell each of those copies to the public, then i am violating the act. so why is it that you are not? >> well -- justice sotomayor: it's not logical to me -- >> sure. justice sotomayor: that you can make these millions of copies and give sell essentially sell them to the public, because you're telling the public when they want to buy it, they can call it up and hear it. so why aren't you trans -- >> well, your hypotheti

aereo is not. we will see what happens in the supreme court, but i believe, ultimately, the broadcasters will prevail. >> michael, you must have a response to that. >> i think the reason aereo is not paying royalties is that it is not required to payroll fees. to pay rolaties. -- royalties. under the law, they are doing a private performance, and that is not the kind of thing that has to be paid to write folders. aereo went out of their way to comply with the law and build their service. >> is the complying with a lot taking advantage of a loophole that could be very easily close, michael? >> no, i think that is complying with the law. if you are engaging in a private performance, you do not have to compensate rights holders. it is the same reasons you don't rights holders because you are singing in the shower or reading a book off of your shelf -- these are all things that are happening privately in your house. the fact that the broadcasters would like to be paid doesn't mean they have a legal rig

aereo is not. we will see what happens in the supreme court, but i believe, ultimately, the broadcasters will prevail. >> michael, you must have a response to that. >> i think the reason aereo is not paying royalties is that it is not required to payroll fees. under the law, they are doing a private performance, and that is not the kind of thing that has to be paid to write folders. aereo went out of their way to comply with the law and build their service. >> what is the complying with a lot taking advantage of a loophole that could be very easily closed, michael? aereo no, i think that is complying -- close, michael? rex know, i think that is complying with the law. if the reasons you don't have to go pay write folders is because you are singing in the shower or reading a book off of your shelf -- these are all things that are happening privately in your house. the fact that the broadcasters would like to be paid doesn't mean they have a legal right to be. >> i wonder if you could come back on th

barry diller says it is all or nothing for aereo, this is a bloomberg exclusive. innovating the road race. i am serious. everyone is talking about the changing times on wall street. >> goldman sachs looking to sell its new york stock exchange market making unit. dutch investment firm imc financial markets is in talks to buy the business. goldman bought the operations into thousands as part of a purchase. >> 5.4 billion dollars, goldman paid for that trading unit in 2000. goldman is now selling it for as much as $30 million. do you get that? five point $4 billion, $30 million. to be fair, goldman made money off that investment over the last 14 years. earning over those 14 years, at that price you are looking at a 99.4% long-term capital loss. this points to a bigger story, this is what the new york stock exchange floor looks like today. there are humans, but there are a lot more computers. it was not always this way. this is back in the 1920's. almost one hundred years ago, that is old school. fast-forward to the 1950's, kind of new school. >> today there are more

>> the model aereo is using is not a technology model. what you were just reading suggests otherwise. aereo technology is not innovative. the technology has been around a long time. it is contorting of the copyright law to try to say black is white and white is black. let's explain that to me. >> aereo is not in the business of just, they are not selling you hardware. it is not that you go to beth i and pick up an antenna called aereo. that is exactly what they do not do. you cannot just go by the antenna and use it. you have to sign up for their subscription service. >> they say that pays for warehousing the antennas. basically, you're renting the space. >> but you are not. >> why the idea i aereo seems simple, turned up the technology is not. in salem,man. access new hampshire, that makes the whole thing possible. ♪ manufacturing facility in new hampshire, machines are assembling hardware. this is the aerial antenna. >> aereo gave us an inside look at the manufacturer where the product came together. where broadcast tv. it is difficult -

is aereo legal? in 13 cities, aereo has created antenna farms, warehouses full of dime sized antennas that work like the rabbit ears you would attach to your television at home. they receive free signals from broadcasters like abc, cbs, nbc, and fox. aereo takes that signal and resends it to subscribers via the internet. you can watch live t.v. on your computer, tablet, and smartphone. aereo will even let you record shows to the cloud for later viewing. the service costs $8 or $12 a month. before aereo, there were three ways to watch broadcast television. you could both an antenna to your roof or t.v. and get it for free. you to pay a cable or satellite company for a dish. while you are paying cable and sadly companies, they are paying broadcasters to retransmit programming to the tune of about $4 billion a year. do you know how much aereo pays broadcast networks? zilch. it argues it is pulling down the same free signal anyone can get with their own antenna. effect the antennas happen to be in a ware

here to discuss that case and some of the technology surrounding this company is chet kanojia, ceo and founder of aereo. mr. kanojia, what is your strongest argument to the supreme court justices that you are not stealing broadcast signals? >> guest: and great start to the questions. i think all of our arguments are extremely strong. so if you start with the basics which is everybody acknowledges that consumers have the right to an antenna, everybody acknowledges a consumer has a right to make a recording of free to air content for themselves, everybody acknowledges there is nothing wrong with a combination of an antenna and, back then, a vcr, now a dvr. so the debate seems to be about where that equipment is located because nobody has appealed the finding of facts which is that each individual consumer controls their own antenna. the antenna is dead until the consumer instructs the antenna to tune to a particular frequency. each individual consumer makes their own copy, unique, distinct, never mingled with anybody else's, and transmits it to themselves. so none of those facts have been appealed or dis

>> aereo is going to be put out of business. he other >> they are taking on a $57 billion industry. you have got to pay for content. one of the ways content is shifting is from advertising to such reaction to paid model. >> what does mr. greenfield get wrong? >> he is talking about -- this guy will -- my stance is when you talk about technology, enabling consumer behavior makes it legitimate. you can use technology to steal. that is what the industry is going to say these guys are doing. tofrom battling broadcasters battling the elements. the company that has people pay to swim through eyes and run through fire, the business of tough mudder is next. ♪ >> this is "lunch money" on bloomberg television. also streaming live on bloomberg.com, your tablet, and your smartphone. i am adam johnson. so you think you are tough? maybe you should try that tough mudder, the 10 mile also go course complete with fire ice, and mud. millioncts over one participants around the world every year. will dean joined us on "surveillance" about how he gre

because they acknowledge that the way the technology works or aereo is its a user initiated copy. but they say no matter if you add enough of them together you can aggregate that to become a public performance. >> there's no reason it's a user specific copy, is it? it would be much easier for you to make one cop yip an everybody could get a copy. >> that's where the issue about replicating what happens in the home matters mr. chief justice. because if i'm in my home and i start the program two minutes aztecnology, i miss the two minutes. it happens to be when i push the button just like when i'm at home watching on a d.v.r. that will be different because i have control over it -- >> surely you can make a bram you have just one copy and starting it at different times. you don't need every viewer to have his own copy. >> but that is the kiedis tippings between video on demand and the sthaffs aereo provides. we don't have a brief to defend the master copy because in the master copy situation that's indisputably public because there's no right to exclude anyone else. with aereo's techn

that is the different between the broadcast band. aereo's case is a classic case of consumer antenna with a pickup device. it is just a technilogical difference and you have to move beyond characterization to look at the significant differences between the two. and as a matter of policy, cable companies don't make copyright payments. after the '76 act, it took a decade or later for congress to device retransmission must care carry. that was because cable companies were market-balanced laws and have nothing to do with copyright. your question suggests there should be a way to bring in copy right regimes. it is unprecedented. congress has never wanted to do that. there was a move to levy the tapes of vcr's. it is congress's content and constitutional sound for equipment providers to increase distribution by enabling technology that does that and that is what we are enabling. >> why can't i buy an aereo antenna and attach it to my tablet. i believe they are small. why must a rent one and pay a service fee to you? >> guest: because there is no r

supreme court will hear oral arguments in the aereo case. what is legal issue the court will be deciding? by now, you may have heard about aereo. launched in 2012 and backed by barry diller, it allows you to watch broadcast t.v. over the internet. is aereo legal? here is how it works. in 13 cities, it has created antenna farms. these work much like the rabbit ears at home. they receive free signals from broadcasters like abc, cbs, nbc, and fox. aereo takes the signal and rescinds it to subscribers via the internet. you can watch live t.v. on your computer, tablet, and smartphone. aereo will let you record shows to the cloud for later viewing. it costs about $12 a month. aereo has three ways to watch broadcast television. you can bolt and antenna to your roof or computer and get it for free. you can pay a cable or satellite company for a dish. while you are paying them, they are paying broadcasters to retransmit program and to the tune of about $4 billion a year. aereo pays broadcast networks so each -- zilch. they argue they are pulling down the sam

dom is here, seema as well. activist, aereo and airlines. teaming up with valeant, making a run at botox. what is the end game? >> access to botox. >> that's hi end game. why not? >> jokes aside -- >> stocking stuffers. >> he clearly sees value in allergan's botox line as well as the eye care vertical. of course, valeant perhaps sees value in having ackman as a teammate, because ackman has experience in hostile takeover. >> it's a growth business and act viss do tend to do well. >> and let's go to aereo. the supreme court to decide whether or not aereo is any different from other capable or satellite phones or if they are entitled to draw freely from programs transmitted, whichever way the court rules will dictate in some ways the future of television. what do you think here? >> i get both sides of the act. i get the fact that i still know people who have rabbit ears and collect the broadcast networks. at the same time i know why you want to pay for it. those fees are key for content providers. >> it's a close call. basically they're download

that aereo is essentially simply an antenna device that replaces technologically what you used to have to do to go up to your rooftop and erect an antenna. now what the media repertoire has been is that aereo is a gimmick. judge rogers asked a question, which was, you're only doing this to get around the copyright laws? >> was he wrong about that? >> the truth is not only is he wrong, what we are doing is complying with the law. so rather than saying it's a gimmick is constructed is law as the way we understood it. broadcasters get a free spectrum. up until technology came along, there was no issue with that because that was the only way you could get it. cable comes along, all these things come along, all these things happen, retrends -- i'm not going to try to dwin that for the audience, but the one fundamental broadcasting since the very beginning is if you can put your finger out there and you are interested in programming, you can get that out there for free. people did not think at the time they wrote these rules that, in fact,

broadcasters say that aereo is no different than a cable company. 012, they sued aereo for violating copyright law. the lawsuit hangs on one thing, whether or not aereo's retransmission is considered a public performance. if it is, aereo is infringing, because they have not paid for the programming. but if the court decides that the service is just a lot of private performances, one for each subscriber, it would not be an infringement, and aereo would not need to pay the broadcasters. so far, the lower and appellate courts have sided with aereo. now it is up to the supreme court to decide. arguments will begin april and there will be a ruling by july. >> so who will win the battle? betty liu asked the founder and ceo of omnivision entertainment. >> we all started recording our own shows a long time ago. i just keep thinking not about media experts and pundits, but real people who are getting more and more frustrated with the amount of money that you spend to get cable television, and can get your own shows when you want, how they want, at pennies on

they say what aereo is doing amounts to left the. nking tv signals and repackaging them for profit without lawfully acquiring the content. but aereo's ceo told katie couric that they have nothing done wrong. >> the idea that someone is using an antenna is stealing a signal, just flies in the face of traditional definition. if someone has come out with a smarter antenna, and you don't like that that evolution is happening, well, i'm sorry about that, and that's just the nature industry. >> patricia sabga, al jazeera. >>> arrow says broadcast television makes 90% of its profits from his advertisers. but on tuesday comes the big test, a showdown at the supreme court. if aereo loses it could put them out of business for good. the ceo says he is confident the broadcasters will win, and if they don't win, he says the networks are form their own version of an aereo. joining me now is mamiram good freed. so as a consumer it seems like aereo is a good thing? >> it seems like it. the fees that the cable companies have to pay the broadcasters ju

justice stephen breyer said he was nervous about what a possible decision against aereo is going to do to other technologies. other justices were skeptical of aereo's basic argument. chief justice john roberts told aereo's lawyer, there's no technological reason for you to have 10,000 dime-sized antenna, other than to get around the copyright laws. the court's decision is expected by the end of june. if aereo loses, it could be put out of business. if the networks lose, scott, they stand to lose billions of dollars. some networks have even said that, if they do lose, they will consider moving programming to cable or the internet. >> pelley: chip, thanks very much. today in kiev, vice president joe biden stood with ukraine's prime minister and demanded that moscow use its influence to get pro-russian militias to leave government buildings in eastern ukraine. last month, russia took the crimean peninsula from ukraine. now, many ethnic russians in eastern ukraine say they want to join russia, too. holly williams is there. >> reporter: the vice president's visit to kiev was a very delibera

but aereo is not paying broadcasters such as abc, nbc and cb s and their attorneys argue that violates copyright laws that publicly distribute the programs to pay for them. >> what is at stake is really the nature of broadcast television as we know it. >> reporter: aereo which is only two years old and available in 11 cities so far say it is not distributing content. just renting equipment, those tiny tv antennas. >> from our perspective the issue in the case was whether viewers had a right to have an ten in a and dvd in their home to local television, that right should be infringed by moving the antenna and the dvr to the cloud. >> the justices seemed conflicted. aereo's technical model seems designed to circumvent copyright laws, but what would it mean for the growing cloud computer industry, the thought echoed by a group that supports aereo. >> it's hard to draw distinction between aereo and cloud services, that are right now questionly legal. >> reporter: the justices are likely to write a very narrow decision should they rule against aereo. and aereo said if they lose, they may ha

a lawyer for the networks says aereo fundamentally is engaged in a business model that's about something for nothing. now, billions of dollars are at stake here. if aereo loses, it's probably the end of its business, at least as it's configured now. if the networks lose, it could undercut the legal authority of charging for the retransmission fees. as you say, argued tomorrow, decision before the end of june. >> thanks, pete, very much. let's get more about what's at stake here. both sides of the case and for all of us, television viewers out there. >> barry cohn is at braumfield, hillary nye are both copyright experts. hillary, let me start with you. how do you think this case goes down, in favor of whom? >> well, i'm going to say in favor of the networks. because it's really not that difficult. this is a case about theft. >> you think aereo is stealing the signal? >> oh, absolutely. >> clear and simple? >> the fact that they're charging for it, the service here? >> absolutely. >> what do you think, barry? >> this has nothing to do with theft. it's no different than if you have an anten

aereo is available to a limited number of u.s. customers. the addressable market is approximately a third of the people who pay for programming, mostly young people. he does not think he can get one third of the addressable market, excess ofnding an $100 million, he will be a will to get to the young people and they will have a choice. then he decides what happens when aereo grows up. fox or cbsppens if lives up to the threat and turns of their channels into cable? >he says, go ahead and try it. i would love to see it. >> he likes a fight. you can catch more of the interview at 11:00 a.m. on "market makers." hong kong billionaire lawrence ho, who plans to hire 8000 people to work in his new casino in macau. by the endrt hiring of the year. i talked to him last week when i was in macau. we toured his city of dreams resort. it has record low unemployment and he plans on offering high pay and scholarships for workers and children. resort costs almost $3 billion. joining us now for more, bri an miller. see howncredible to transformed. it is not j

this is just one in a series of legal battles for the start up company, aereo. >> aereo is only two yearsld, but faced fights with broadcasters, aereo finally went to the supreme court and said please decide this issue. >> it's the little tech start up that's giving t.v. broadcast networks a big headache. >> a new platform for bringing live broadcast t.v. to the internet wherever and whenever we want it. >> before expensive cable packages were offered, rabbit ears captured programs if you were lucky. aereo has taken that concept and reduced the antenna to a tiny chip stored in a antenna farm, broadcasting networks, stores their programs in a cloud and delivers them live to your commuter, smart phone or tablet. >> aereo that ha taken that antenna and made it small enough that hundreds of thousands fit in a single room. >> it's that technology that has the networks crying foul and taking aereo all the way to the supreme court. there they will argue that aereo has stolen their broadcast signals for the purpose of repackaging and selling them for profit, by passing the billions cable companie

from where you sit in d.c., why is aereo important? it is a new model on being able to obtain television over they are using internet protocol. there are different models. aereo is basically free. i think it is no cost for the most part. tv is trying to pay content providers. ip connection,n wherever you might be. people want to watch things on demand where they are. cbs, disney, they are very mad about it. coming up, you remember the website, hot or not? you read people's attractiveness. there's a connection between your looks and your ability to win funding from investors. we will discuss on "surveillance." ♪ good morning. i am tom keene with scarlet fu and adam johnson. mike lewis on at 10:00. this was all over twitter last evening. , the biggestlson concern we have with modern markets is their complexity and operational risks. the market structure that enables the high-frequency traders and provides us with their benefits may be one that risks technological calamity. it is a caution paragraph. from "the wall street journal." prices

arry backed aereo. this is a david versus goliath story. ng aereo because they believe this companies stealing copyrighted material o says, no, we are like your antenna or tivo where we are transferring that data over to consumers. we met with the ceo of aereo outside this up in court yesterday. he said, look, we are in -- we are andider equipment provider. >> i have somehow made it simpler so consumers will exercise their right. they know that is consumers exercising their right to take an antenna. >> why are those rates going up? why are you paying more in your cable bill? if you look at this chart, cable providers are paying $4 billion this year for those retransmission fees back to broadcasters. tot is expected to go up over $7 billion in 2018. the fear among broadcasters is, hey, if they can start getting their signals wherever they want using aereo, they will cut the even more. that undermines the credibility of those fees. >> we will be tweeting out that chart. for whattage for us will be going on in the court today. who are the attor

and so broadcasters including msnbc's parent nbc universal argued that a new company aereo is stealing their content and rebroadcasting it over the internet without paying for it. >> and the tv comes in over the air through the dish or the cable, and then there is the internet whenever and how however we want. sure it is individuvideo, but i of the. the real live 24/7 tv that we know and love, it is not on the internet until now. now, there is aereo, the new platform for bringing live tv to the internet whenever and however we want it. >> okay. let's bring in our nbc news justice correspondent pete williams joining us from the supreme court. and let's start with the ban on affirmative action that took place an hour ago, and tell us how that played out. >> well, it was a 6-2 vote, and nine justices and elena kagan sat this out, because she worked on the issue in the justice department, but the issue is whether constitutionally michigan voters could ban affirmative action or whether it put minority members in michigan at a disadvantage and whether it made them jump a higher hurdle to cha

the only thing i'm paying for is internet. >> reporter: he uses the online service aereo. along with several other internet video services. slashing his once $110 tv bill in half. aereo launched last year from a warehouse in brooklyn and now available in 11 cities charging customers $8 a month to watch any broadcast tv network live or recorded. to use aereo you don't have to buy any new gadget. subscribers get on line with their phones or tablets. if i missed my daily celebrity gossip fix, i now have "access hollywood" right at my fingertips. each account has access to a microantenna at one of aereo's data centers that grabs signals. those signals feed into dvrs until the user wants to watch and then the shows are streamed to them online. aereo said that's no different legally than a person at home using an antenna and a home video recorder. >> we consolidated those two technologies and located them remotely so the consumer can enjoy broadcast tv as they have for a very long time. >> reporter: the broadcast networks including nbc say aereo is different. they say it takes f

my prediction is aereo loses. they were too concerned -- the word theft that joe used and was used in the courtroom and too heavy for them. >> cloud three. >> i don't know what that is. >> joe, judge, thank you both. this has to do with the broadcast channels. nothing to do with cable. doesn't affect fox news. 21st century fox is part of the big company that news corporation. thank you very much. >>> could this be the laziest postman in the united states? stay tuned. >> here is your i-phone. here is your crystal, martha. >> how he got caught and what the postal service is doing about him. >> and astronauts hard at work and we will see what they are up to and deeper in the space with our favorite astronaut today. ♪ ♪ [ male announcer ] help brazil reduce its overall reliance on foreign imports with the launch of theountry's largest petrochemical operation. ♪ when emerson takes up the challenge, "it's never been done before" simply becomes consider it solved. emerson. ♪ there was a boy who traveled to a faraway place

that is not something that you can do in the aereo technology. i have no brief to defend that. that would be a very difficult reproduction right question. but it doesn't matter in terms of who is exercising a private performance, because that is being done in the home with the user-initiated, user-specific copy. >> mr. frederick, your client is just using this for local signals -- >> yes. >> right now. but if we approve that, is there any reason it couldn't be used for distant signals as well? >> possibly. >> possibly what? there is possibly a reason, or it could possibly be used? >> it can't be used for distance, but it implicates -- >> what would the difference be. i mean, you could take hbo, right? you could --you could carry that without performing. >> no, because hbo is not done over the airwaves. it's done through a private service. but justice scalia, let me answer your distant signal hypothetical this way. that would implicate again the reproduction right. t does not implicate the private performance and public performance distinction, because, even if you were to take d

elias is getting very angry. -- goliath is getting very angry. has theems like aereo legal edge. in your view, is it fair what they are doing? >> the question is whether they are going to have to pay retransmission fees. we all started recording our own shows a long time ago. i keep thinking not about media experts but real people who are getting more and more frustrated with the amount of money you spend to get cable television. they can get their own shows when they want and how they want . it is frustrating. >> it is frustrating. or vh1,re back at mtv what would you be thinking right now? oni would be focusing creating the very best content and figuring out as many smart new ways to get that into the hands of people who want it when they want it and not when we want you to see it. i read programming at mtv for years. whenlled up the schedule we pushed of the shows to you that we wanted you to see. that world is ending so quickly. the concept of prime time is now your own and not the networks'. thosewe don't get retransfer fees, we are not going to be able to provide such great

anyway, that's the argument that aereo is making. -- listen, we have nine justices that will decide on this case. >> that is the copyright issue. it's not just the aereo versus the broadcasters. >> listen, i don't support the use of this on anything but pork products or something other that's delicious. >>> still ahead on the halftime. who won the debate on mcdonald's? you guys picked the winner. we're going to rereel the results. by the way, bowl old steen, chairman and c.i.o., he's very addiment. he says companies are doing earnings all wrong. he thinks that earnings are being manipulated. a big call. he'll be on "street signs" a pretty fine program from what i hear. i'll be sitting in with melissa. it's for the climate. the conditions in new york state are great for business. new york is ranked #2 in the nation for new private sector job creation. and now it's even better because they've introduced startup new york - dozens of tax-free zones where businesses pay no taxes for ten years. you'll get a warm welcome in the new new york

and so broadcasters including msnbc's parent nbc universal argued that a new company aereo is stealingroadcasting it over the internet without paying for it. >> and the tv comes in over the air through the dish or the cable, and then there is the internet whenever and how however we want. sure it is individuvideo, but i of the. the real live 24/7 tv that we know and love, it is not on the internet until now. now, there is aereo, the new platform for bringing live tv to the internet whenever and however we want it. >> okay. let's bring in our nbc news ju

the major networks including cbs say a small company aereo is breaking laws by offering free tv showsustices seemed concerned their ruling could strangle internet innovations. their decision is expected by the end of the june. >>> the job market for college grads has gotten better but only slightly. the labor department says the unemployment rate for 2013 college graduates just under 11%. that is down from 13% in 2012. but it is still higher than the 9.6% rate for all americans ages 20 to 29. >>> could e-cigarettes go up in smoke? the fda is expected to propose tough rules for the fast growing market as early as this month. public health groups are calling for the fda to regulate electronic cigarettes just like regular cigarettes, including banning sales to minors. >>> and airline ticket prices have bumped up slightly. the government says the average price for domestic airfare was $381 in the fourth quarter last year. that's an increase from about a buck a year before. it includes taxes but not all of those fees like checking bags or boarding early. anne-marie? >> yeah. that's easily

ruling, those support what aereo is doing. >> if aereo can do it, i don't understand why comcast has to pay nbc for -- why do cable companies have to pay in the first place? they could take free over the air content and sell it on for free? >> for 40 years they did. >> why don't they just do that? >> porter's point is part one. >> they did it a long time. >> and part 2 is that comcast wants to make sure it has stuff to offer people. another story that a lot of people have been focusing recently is why is netflix paying comcast money to ensure that it has better broadband speeds? just yesterday it said we're against the merger of comcast with time-warner cable because they'll have more control. so they hate that comcast has the ability to do that but they're also going to pay them because they're offering a service and want to make sure their customers have smooth speeds when they're watching in primetime. comcast, any paid tv player wants to have all of that content. so it really comes down to the leverage that the broadcasters have. and if you can afford to pay them some money, well

aereo is not paying a.b.c., n.b.c. or c.b.c. broadcasters, and attorneys argue it violates copyright law. >> i think what is at stake is the nature of broadcast television as we know it. >> aereo, which is two years old and available in 11 cities so far, argues it is not distributing content, just renting equipment - the tiny tv antennas. >> from our perspective the issue is whether consumers, who had a right to an antenna and ddr and make copies of local broadcast television, if that right is infringed by moving the antepa and d.d.r. to the cloud. >> justices seemed don flilent. chief justice john roberts said the technical model seems designed to circumvent copyright, justice steven brier worried about the consequences of finding aains aereo, and what it means for the growing cloud industry, a thought echoed by a group supporting aereo. >> it's hard to draw distinction between aereo and cloud services and popular internet-based services that are right now unquestionably legal. >> because of that concern the justices are likely

it is a hard case to prove forae-- hard case to prove for aereo. ry hard for them to say we should be able to get off retransmitting signals without having to pay for them when there is precedence by cable providers and satellite companies that they have to pay billions of dollars for the content. the technology companies disrupted an established industry. any other disruptors out there that we should be watching when it comes to the cable business and traditional television? >> there are quite a few. tv. the top not just disruptions but also temptations. clan, you cannot get enough of it. gaming on the smart phone and tablet. tv is not the dominant primary medium for entertainment. matter-of-fact, below the digital devices and 18-34-year-olds. tv has a ton of challenges. tv content in great shape. the traditional tv distribution methods are absolutely heading towards disruption. will not happen overnight. >> do you see any parallels between this and other industries, other traditional incumbents like amazon did and what google is doing for taxi? i

aereo. it allows you to watch broadcast tv over the internet, but is it legal echo in 13 cities so fall, aereo created antenna farms. warehouses full of antennas. these work like the rabbit ears you would attach to your television at home. they receive broadcast signals from networks like abc, cbs, and fox. that signal and resend it to subscribers via the internet. then you can watch live tv on your computer, tablet, or smartphone. aereo will even allow you to record to the cloud. the service costs about $12 a month, but here is where it gets sticky. , you can fold and intended to your tv and get the signal for free, you could pay a cable company for a box, or a satellite company for a dish. while you are paying china light -- cable and satellite companies, they are paying the re-broadcasters. but do you know how much aereo pays broad cap this works -- broadcast networks? none. aereo claims they are airing everything that people can get with their own antenna. isadcasters say that aereo no different than a cable company. in march 2012, they sued aereo for violating copyright law. the lawsuit h

they say aereo is illegal. pay retransmission fees, the privilege of bringing it to the consumer. lawsuit has reached the supreme court, which is hearing arguments in a few weeks. i asked barry diller about the case and whether the decision is indeed a matter of life or death for aereo. >> yes, i believe so. >> so if you lose -- >> if we lose, we are finished. >> there is nothing you can salvage? >> it is very possible that there is some salvage. -- i can't probably see any past work past this. >> why is that? you have a platform. you would be ruled a multi-video programming distributor. you would be like a cable company. could you not compete for content? >> we could probably pay retransmission consent dollars if we could make a deal with broadcasters. the value proposition would go out of the game. method of low-cost receiving over the air broadcasting. that is the platform. >> what if the supreme court grants you life? what happens then? >> we compete. we go on to build our business and we expand through the

i directly stole from a given news organization. >> the argument is that this is aereo, this is what hen aereo broadcast systems out of the air, repackages them, puts them on the internet and charges money for them. >> they charge money for this which is the defense for a lot of the online -- >> how does the state department -- i have come up with a phrase is out there, how does secretary john kerry or secretary whoever if the republicans win in 2016, how do they adapt to the digital age? >> it is the voice of america, a group that has always tried to get its message overseas to a new population. when we talk about the function of digital media, this functions the same way as in the old soviet bloc. it is not possible to get the newspapers out to the populations in non-democratic countries. the united states is trying to do that. >> fascinating. kliment.has and alex we will look at the agenda for the day, i will begin with the boston marathon. i will be watching. aldington, massachusetts is where will begin, and they will move to boylston street. >> that -- that is a picture, -perfect

aereo is a low-cost method of receiving on-air broadcasting. that is the broadcast -- that is the.tform. and toldng to compete our business and go to the parts of united states where we are not currently in. we are only in 14, 16, 17 cities. we would be in any urban city, certainly top 30, 40 markets. >> this is an effort to reach what you believe to be the addressable market of a herd of -- >> at the most, a third. i think there are a great many people who say that cable programming and satellite programming is becoming much too expensive and they would prefer an alternative that is a much less cost. by definition, the younger rather than the older. but to me, i don't think we will reach a third. but to me that is the addressable. >> what about threats from the likes of chase carey who recently have made broadcast networks into cable channels and render your low-cost alternative neutered? >> i think it is very unlikely that a broadcaster who dealt their business on spectrum that they got for free, spectrum by definition belongs to the american people, they got it free in return fo

barry diller says it is all or nothing for aereo, this is a bloomberg exclusive.

the lawyer for aereo says our technology is special. ps our customers to individualize and access the programs they want to see, bill. >> peter, the magical question ultimately. what if aereo wins? what happens? >> well, the broadcasters and analysts are saying that the networks could perhaps start their own streaming video services that you pay for to compete with aereo. they could start their own pay cable channels. they could start moving some of their best programming, like their sports shows, to cable, pay cable channels. here's what the lawyer for the broadcaster said. >> if a company like aereo can somehow provide content to lots of paying strangers without engaged in a public performance, i think the networks at least some of them will have to rethink the way that they provide content. >> and the court is expected to rule on this case by the summer. and i do want to make sure that everybody understands, just because the justices seem to ask the tougher question of aereo doesn't mean they'll decide against aereo or for the broadca

. >> it is auto pay, you don't look at it. for all the controversy over aereo not see a lot. turns out the current business d,del might be flawe demand for free tv is declining. that the hours spent watching free broadcast television has plateaued. overs not gone anywhere the last six years. contrast that with the time spent watching cable tv. it has grown from 900 hours per 2010. in 2004 to 1100 in this is a problem for aereo, that broadcasts only network tv. even though aereo is small, it represents a threat. >> in the next hour, we will talk to the executive who is dead set against aereo. >> the ceo of e.w. scripps, they own about 21 television stations. they have a lot at stake. >> i read the research on this, they show cable wins. >> prestige cable. >> cable wins -- >> profitability -- >> viewers, influence. >> radio does well. everybody has expected the death of radio. >> if uyou drive -- >> i do not drive a lot. >> i figured since you were in providence -- >> i take the train. >> he is in the quiet card writing quadratic equations. >> photos. >> physical

is not entitled to a payment. now the high court has to decide exactly what aereo's service is. one person, one at a or simultaneous broadcast to lots of people who can access it. in other words, the public. now in a filing the broadcasters told the high court, quote, this case presents questions of copyright law that profoundly affect owe potentially endanger over the air broadcast television. aereo's ceo says, quote, if the broadcasters succeed, the consequences to american consumers and the cloud industry are chilling. david and liz. we'll be at the court tomorrow to listen to the arguments. liz: we do have breaking news now on something we find absolutely fascinating and you might too. bill ackman, of course the billionaire investor, who has taken long and short positions on everything from jcpenney to herbalife, is now trying to functionize, something very interesting here, he is teaming up with valiant pharmaceuticals international to try to buy wrinkle treatment botox-maker allergan. what is interesting here, ackman has a very large stake in allergan. so he has about a 10

is >> eddie lou there with rich greenfield. just a note, bloomberg tv does have a distribution agreement with aereo. gendary designer is wearing a new hat is a venture capitalist. he joins me to talk design and tech next. ♪ >> i'm emily chang and this is "the best of bloomberg west." ms. legendary designer spent more than a decade as head of research at media lab. he went on to one of the most prominent art schools of the world. he is the first design partner to join intervention -- a venture capital firm. he joined us and i started asking him about his recent move into venture capital. >> it is so amazing. the speed is so extraordinary, the people, the energy. it is intoxicating. i kept telling students, kobe like ryan and joe. i felt a little disingenuous that i wasn't going myself. so why not, i thought. >> you're helping portfolio companies, but you're are also sourcing new investments. >> i'm trying to understand the strategic value of design. formation, company ignition. early incubation. how to get design as early as possible into the process is something i have a lucky to get a chance to look