Disney blackout on DirecTV frustrates fans of ESPN’s ‘Monday Night Football’
Millions of DirecTV customers could miss ESPN’s kickoff of “Monday Night Football” — a highly anticipated game between the San Francisco 49ers and New York Jets — as the Walt Disney Co. channel blackout stretched into its ninth day on Monday.
DirecTV and U-Verse customers have become increasingly frustrated as the dispute drags on, disrupting Disney’s coverage of the opening week of college and NFL football and the U.S. Open tennis tournament. Disney Channel, FX and ABC television stations also have been dark since Sept. 1.
The Disney-DirecTV tussle turned testy over the weekend after DirecTV filed a complaint with the Federal Communications Commission alleging Disney has not been negotiating in good faith and its tactics were anticompetitive. DirecTV rolled out an ad campaign featuring Mickey Mouse from “Steamboat Willie,” including one image of the rodent blithely navigating a wooden vessel over a water cliff.
“The negotiations have stalled because Disney insists on bundling and penetration requirements that a federal district court judge in New York recently found ... to be unlawful, anticompetitive, and ‘bad for consumers,’ ” DirecTV alleged in its complaint.
Disney pulled its channels from DirecTV and U-Verse on Sunday, just minutes before a highly anticipated USC-LSU college football game. DirecTV has offered credits to customers as the blackout reflects building tensions in the TV industry.
Disney and other programmers have demanded license fee increases for their programming, including cable shows that are no longer exclusive to pay-TV distributors. Programmers are seeking to cover their increased costs, including carrying NFL and NBA games.
Pay-TV providers such as DirecTV are under even greater strain. More than 4 million customer homes dropped pay TV in the first six months of the year, according to research firm MoffettNathanson.
DirecTV has chafed over Disney’s shift to streaming.
“Disney wants to force DirecTV to carry a ‘fat bundle’ including less desirable Disney programming — while itself offering cheaper, ‘skinnier’ bundles of programming that consumers want,” DirecTV said in its FCC complaint.
The FCC process could drag out for months, providing little relief to DirecTV’s nearly 11 million customers. The two sides have made progress by tentatively agreeing on fees, sources said.
In September last year, a nearly 12-day blackout of Disney channels on Charter Communications’ Spectrum service ended as the first “Monday Night Football” game of the season got underway. That came just as Jets quarterback Aaron Rodgers suffered a season-ending injury in the opening minutes of “Monday Night Football.” Rodgers is expected to play against the 49ers.
In its messaging, Disney has encouraged frustrated viewers to cancel DirecTV in favor of other distributors, including Hulu + Live TV, which Disney owns. The company also offers Disney+ directly to consumers and, this year, it entered into a joint venture with Warner Bros. Discovery and Fox Corp. to create a sports-centric package of cable channels, including ESPN, called Venu.
But last month, the New York judge issued a temporary injunction to block Venu’s launch, saying the service could be anticompetitive.
Disney, which is moving toward its goal of launching ESPN with its live sports to consumers next year, has denied DirecTV’s claims.
“We urge DirecTV to stop creating diversions and instead prioritize their customers by finalizing a deal that would allow their subscribers to watch our strong upcoming lineup of sports, news and entertainment programming, starting with the return of Monday Night Football,” Disney said.
Disney’s eight ABC stations, including KABC-TV in Los Angeles, are blacked out on DirecTV and U-Verse, meaning viewers are missing local newscasts, “Good Morning America,” “The View” and “Jeopardy.”
All customers of DirecTV Stream, have lost access to their local ABC station because of a standing agreement that enables Disney to negotiate on behalf of local ABC affiliates owned by other companies.
Beyond “Monday Night Football” and college football, if the blackout extends into next weekend, DirecTV customers could miss Sunday’s telecast of the 76th Primetime Emmy Awards.
DirecTV has offered $30 credits to customers. But that hasn’t mollified many subscribers.
The ABC and ESPN blackout on DirecTV — affecting nearly 11 million homes — comes during a busy sports calendar with college football, the NFL and the U.S. Open tennis tournament.
DirecTV wants to offer smaller genre-themed bundles, such as children’s and family entertainment, local broadcast stations and sports. Disney executives said they were willing to work with DirecTV, but the talks remain bogged down.
One of the biggest sticking points in the talks has been Disney’s requirement for “minimum penetration” for its channels. Disney has long demanded its channels reach at least 90% of DirecTV’s subscriber base, according to the FCC complaint. (The minimum threshold for ESPN channels is closer to 80%, executives have said.)
When DirecTV doesn’t meet that mark, it has to pay huge penalties, DirecTV executives have said.
“The parties remain at impasse because Disney has refused to allow DirecTV to offer “skinnier bundles” of programming — unless DirecTV also meets related minimum penetration requirements designed to make the provision of such skinny bundles effectively impossible or prohibitively expensive,” DirecTV said in the filing.
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