Jannah Theme License is not validated, Go to the theme options page to validate the license, You need a single license for each domain name.

Disney, Charter battle over Spectrum blackout, streaming

Cable giant Charter Communications and Disney are in a battle over contract fees that has left millions of people without access to U.S. Open and potentially “Monday Night Football,” with the NFL’s season starting in just days.

On Thursday, Disney said that the two companies have been in ongoing negotiations but yet to agree to a new deal. That resulted in Charter’s roughly 14.7 million Spectrum customers losing access to its networks, including broadcaster ABC and pay-TV channels such as ESPN and FX.

These sorts of battles, which can lead to so-called blackouts for pay-TV customers, are common in the industry. But, in the age of streaming, this one is different.

“This is not a typical carriage dispute,” Charter CEO Chris Winfrey said Friday on a call with investors.

Early Friday, Charter executives called the pay-TV ecosystem “broken.” They said they pushed for a revamped deal with Disney that would see Charter cable customers receive access to Disney’s ad-supported streaming services like Disney+ and ESPN+ at no additional cost.

This seemed to be the sticking point as Charter said it accepted Disney’s request for higher fees, although Charter executives didn’t provide specifics on the negotiations as they remain hopeful to get a deal done.

Winfrey noted that in the last five years the entire pay-TV ecosystem has lost nearly 25 million customers, or almost 25% of total industry customers. “It’s staggering,” he said.

Between the high cost of the traditional bundle and the option to switch to more affordable streaming options – most of which are provided by the same companies behind the networks on pay-TV – the speed at which cord-cutting is only accelerating.

Live sports, particularly those shown on ESPN, have long been considered the glue holding the pay-TV bundle together, especially as customers flee for streaming services.

The two companies renewed their contract in 2019, which also included Charter integrating Disney+ and ESPN+, as well as Hulu, into its set-top boxes to give customers more seamless access to those apps, CNBC previously reported.

Charter, which also provides broadband and mobile services but is not in the content business, has said it values its pay-TV business and wants to see it thrive, even if it takes on a different form than the past.

The company took a step toward that earlier this summer when it announced it will offer a sports-lite package – without regional sports networks, but would still include ESPN – to customers at a cheaper rate.

Winfrey said on Friday that was not an option it presented to Disney, although he “would love that,” but believed it was “a stretch too far” for Disney.

Instead, Winfrey said the company sees the option it presented to Disney as a “glidepath” forward to a new business model that keeps the cost of the traditional bundle down for customers who still want it, and puts more eyeballs on Disney’s ad-supported streaming services.

Disney CEO Bob Iger recently said on CNBC that assessing its traditional TV business is at the top of his list, and opened the door to potentially unloading these assets in a sale. The CEO, who returned to the helm late last year, said he realized the company is facing a lot of challenges, many of which are “self-inflicted.”

Iger did note that ESPN is in a different bucket and Disney was instead open to selling a stake in the network while also moving toward a direct-to-consumer streaming service of its live feed.

Still, ESPN Chairman Jimmy Pitaro said at a CNBC event this summer that while this is the future for ESPN, it wouldn’t be in a way that would leave pay-TV distributors behind and nix the traditional pay-TV model that has supported the business for so long.

“The [traditional TV] model has been very good to Disney,” Pitaro said at CNBC x Boardroom’s inaugural Game Plan sports business summit.

Disney said Thursday that it has been able to secure successful deals with other pay-TV companies and is still committed to reaching an agreement with Charter. A Disney spokesperson didn’t immediately respond to a request for further comment Friday.

Source by [author_name]

Related Articles

Back to top button