Millions of DirecTV customers likely won't be able to watch the NFL's “Monday Night Football” opener on ESPN, as the company has yet to reach a deal with the network's parent company. Disney Starting Monday night.
Disney's television networks stopped offering service to DirecTV customers on Sept. 1 amid a battle over rates and content packages. Those networks include pay-TV channels ESPN and FX, as well as the ABC network in some markets.
Disney and DirecTV are unlikely to reach a deal in time for the premiere of “Monday Night Football,” according to people familiar with the matter. However, negotiations are ongoing and things could change, they added, and a deal could be reached tomorrow.
The satellite and streaming company that Disney calls anti-consumer because DirecTV is pushing an option where it could create specific packages for each genre, such as children, entertainment and news, something that Disney opposes.
As a result of the fight, DirecTV customers were unable to watch the U.S. Open or the entire first weekend of the college football season.
Live sports continue to attract huge audiences and, in turn, high-value broadcast rights deals, which in turn have created some of the most expensive networks on television. ESPN is said to command some of the highest fees paid by pay-TV companies to carry the network and its sister channels, CNBC previously reported.
Meanwhile, sports have long been seen as the glue that holds the traditional pay-TV package together as customers flock to streaming services. Four million pay-TV customers have been lost this year to date, according to a recent report from MoffettNathanson.
DirecTV's streaming battle comes as its latest advertising campaign has highlighted its streaming options to attract consumers.
“Walt Disney Co. has once again refused to be accountable to consumers, distribution partners and now the American judicial system,” Rob Thun, DirecTV's chief content officer, said in a statement last week.
Last month, a US judge temporarily blocked the sports streaming service Venu, a joint venture between Disney, Fox Corporation. and Warner Bros. Discovery — to launch in time for the NFL season. The suit was brought by internet television package provider Fubo TV and supported by DirecTV and Dish's EchoStar.
The suit argued that there were antitrust concerns related to Venu. The companies also argued that Venu would be detrimental to their businesses as it would offer a sports-only package. Pay-TV distributors have argued that they are losing customers at a rapid pace due to high programming costs that have caused the package price to skyrocket when streaming was initially a cheaper option.
DirecTV alerted its customers on Friday about competing alternatives for watching ESPN and also said it would offer a $30 credit to customers.
On Saturday, DirecTV said it filed a complaint with the Federal Communications Commission, alleging that Disney failed to negotiate in good faith.
DirecTV said Disney has “insisted that DirecTV agree to a 'clean slate' clause and a covenant not to sue, both intended to prevent DirecTV from taking legal action with respect to Disney's antitrust claims, which would include filing good faith complaints with the Commission.”
Disney has said it is “open to offering DirecTV the flexibility and terms we have extended to other distributors,” adding that it “will not enter into a deal that undervalues our portfolio of television channels and programming.”
“We never want to be without signal. It's not good for either party. It's not good for the customer, of course. We did everything we could,” ESPN president Jimmy Pitaro said on CNBC last week.
Disney later added that more than 90% of DirecTV households watched its channels each month last year and that it has the top-performing content on the platform, citing Nielsen. The company also said it has proposed a variety of packages to DirecTV and is also asking for rates that are in line with other distribution partners.
The NFL, in particular, is often the reason that passenger-related disputes have been resolved, with the most recent example occurring last year.
Last September, the cable giant Letter Communications and Disney went through a similar battle that ultimately lasted 10 days. However, Charter and Disney reached an agreement hours before “Monday Night Football” that allowed customers to tune in that night.
Last year, Charter had argued that the pay-TV business model was broken, noting that programmers like Disney had siphoned off much of their content to their streaming services. In response, Charter pushed for its customers to receive access to Disney’s ad-supported streaming apps, Disney+ and ESPN+, at no additional cost.
ESPN's Pitaro referenced negotiations that took place with Charter a year ago in his comments last week.
“While we know it was very difficult to get the deal done… I give a lot of credit to Charter because they came into the room with very specific ideas. They had a vision that they wanted to execute,” Pitaro said on CNBC.
The dispute between DirecTV and Disney has led to clashes between the two companies reminiscent of most car fights.
In this case, ESPN reporter Adam Schefter announced Monday's matchup on ESPN between the New York Jets and San Francisco 49ers on social media platform X, and pointed out which other platforms DirecTV subscribers could sign up for to watch the game.
DirecTV also expressed its discontent.
“Disney is in the business of creating alternative realities, but this is the real world, where we believe everyone makes a living and should be held accountable for their own actions,” DirecTV's Thun said in a statement. “They want to continue to pursue maximum profit and dominant control at the expense of consumers, making it difficult for them to select the shows and sports they want at a reasonable price.”
