Sept 14 (Askume) – Walt Disney (DIS.N) and DirecTV announced on Saturday they had reached an agreement in principle that will restore college football and other events to the satellite TV provider’s more than 11 million subscribers.
The companies said in a joint statement that the deal would give satellite TV customers more choice and flexibility. DirecTV customers lost access to ABC, ESPN and other Disney-owned networks on Sept. 1 after renewal talks between the two sides reached a deadlock .
DirecTV will be able to offer a number of genre-specific programming packages, including programs focused on sports, entertainment, children and family programming. The satellite TV provider sought to change its offerings to better address consumer choice in the streaming TV era.
Disney’s streaming services, Disney+, Hulu and ESPN+, will also be included in some of DirecTV’s packages. The satellite TV provider also has the right to distribute a streaming version of its flagship ESPN network when it launches.
According to two sources familiar with the deal, the entertainment giant has received better economic benefits under the new agreement.
“DirecTV and Disney have a long history of connecting consumers to the best in entertainment, and this agreement builds on that commitment by recognizing the tremendous value of Disney’s content and the evolving preferences of DirecTV customers,” the companies said in a statement.
The dispute caused DirecTV customers to lose access to iconic programming, including ESPN’s broadcasts of college football games and the US Open tennis tournament. DirecTV customers were also unable to watch the ABC News-hosted US presidential debate between Vice President Kamala Harris and Republican candidate Donald Trump on the ABC broadcast network .
Subscribers of the satellite TV service are suffering because of programming blackouts, DirecTV Chief Marketing Officer Vince Torres said Thursday at the Goldman Sachs Communacopia + Technology conference in San Francisco.
Disney and DirecTV reached a deal ahead of Sunday’s Emmy Awards telecast on ABC, with the media giant appearing poised for a historic profit on the strength of the year’s three most-nominated series, “Shogun,” “The Bear” and “Only Murders in the Building . “
Distributors such as DirecTV and programmers such as Disney have feuded over rates for decades as the cost of television packages has risen.
The decades-old practice of “bundling,” or requiring pay TV distributors to pay for and air less-watched networks like Freeform in order to gain access to ESPN’s pricier programs, has helped propel the TV industry. The contract terms also specify how widely the distributor makes this content available to its customers.
Sports have historically provided a buffer against the collapse of the pay TV industry, and have continued to attract viewers even as cable and satellite TV distributors have seen their subscriber numbers decline.
But as viewers move to streaming, sports are moving in that direction, too. Major events like the recently concluded Olympics have moved to streaming, along with professional sporting events from the National Football League and National Basketball Association.
Venu Sports , a planned sports streaming service that brings together programming from joint venture partners Disney, Warner Bros. Discovery (WBD.O) and Fox (FOXA.O) , threatens to further accelerate pay TV’s decline. Venu’s launch has been delayed while awaiting the outcome of an antitrust trial .
DirecTV has stated that it wants the opportunity to offer its customers genre-based programming packages tailored to their preferences through Venu, and does not want to force customers to pay large amounts for TV channels they do not watch.
“It’s a style that we believe is good for consumers, something we want to provide to consumers,” Torres said.
