On June 25, the Supreme Court ruled that Aereo's Internet streaming of over-the-air TV signals to its subscribers was illegal.

Aereo didn't provide the kind of a la carte media service consumers clamor for. The kind that would allow you to pay for five channels you watch instead of a basket of 180 of them. Instead, it built data centers with thousands of tiny antennas for receiving broadcast television. It would then allow consumers to get those broadcast channels -- ABC, Fox, NBC, etc. -- digitally, and with a cloud-based DVR for recording shows. 

Aereo's loss is a victory for broadcasters such as Disney's (NYSE:DIS) ABC, CBS Corporation (NYSE:CBS), and Comcast's (NASDAQ:CMCSA) NBC.

Yet many cable operators were hoping Aereo would succeed. Why? Well, the rising cost of your cable bills comes largely down to the increasing rates cable channels such as ESPN have been asking for from cable operators such as Time Warner

And broadcasters -- who can freely transmit their channels -- also have been increasing the payment levels they get from cable operators. The fees, known as retransmission fees, stand at $4.3 billion annually. 

So, the ruling against Aereo reenforces the status quo in television, and the status quo is rising cable bills. 

In the following This Week in Tech video, The Motley Fool's general manager, Eric Bleeker, and tech bureau chief Max Macaluso discuss what the Aereo decision means for cord cutters, broadcast television, and cloud services. In addition, they discuss some of the legal background to the decision, and how the ruling against Aereo could affect other industries. 


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Eric Bleeker, CFA, has no position in any stocks mentioned. Max Macaluso, Ph.D., owns shares of Apple. The Motley Fool recommends and owns shares of Apple and Walt Disney. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.