As the content industry struggles to hold on to long established business models, consumers are pushing forward and creating opportunities for new methods of content consumption. Last year a company called Zediva tried to get around the draconian streaming agreement by matching each viewing session up to a physical DVD and DVD player. Unfortunately, they were obliterated in the ensuing legal battle.

A challenger appears! On March 12th Aereo launched an invitation-only service in New York City. They claim to have circumvented the rebroadcasting restrictions placed within US copyright law by leasing each customer their own antenna and having no influence or control over what the customer decides to watch. Sound familiar? The broadcast networks are claiming that they are profiting from the illegal rebroadcast of their content, but Aereo asserts that it is simply providing facility for customers to tune and stream their own content, something similar to Slingbox’s offering.

I’ve tried the service. It currently only works on iOS devices (including AirPlay streaming), which I find strange as desktop Safari and Chrome have excellent HTML5 and Javascript support. The service works well, compression seems fairly limited and the 720p stream looks very good on the iPhone and passable on the new iPad’s retina display. The interface is strangely anachronistic, resembling a Web 2.0 TV Guide. We’re all familiar with the channel guide. Can we move on? The DVR feature is very nice, providing up to 40 hours of recording.

We should brace ourselves for the all but inevitable shutdown, but there is one glimmer of hope in all this: the creator of Aereo is also the creator of Fox Television, and has raised over $20 million in funding. It’s likely that they’ve set aside a significant portion of this funding for legal fees as they’ve gone on the offense, seeking a preemptive injunction declaring their business model to be legal.

It’s doubtful that they’ll survive, but hopefully it pushes the industry just a bit further toward sanity.