DirecTV and Disney Disney has struck a deal to bring its ESPN and other channels back to pay-TV provider customers after a roughly two-week hiatus.
The deal was finalized in time for this Saturday’s college football broadcasts on ABC, ESPN, SEC Network and ACC Network, as well as the Emmy Awards ceremony on ABC. CNBC previously reported the deal could be finalized as early as Saturday.
Disney’s network was shut down on September 1 after the two sides could not agree on terms on pricing and bundling structure. The dispute has left DirecTV’s more than 11 million customers unable to watch the U.S. Open, college football and this season’s opening game, “Monday Night Football.”
DirecTV executives began pushing for simpler, genre-specific bundles to be offered to customers in the weeks leading up to the dispute and even as Disney shut down its networks, saying DirecTV’s proposals didn’t reflect the value its networks offered.
DirecTV and Disney announced Saturday they had reached an agreement calling for “market-based terms” on pricing.
The deal gives DirecTV the opportunity to offer multiple genre-specific options across sports, entertainment and kids and family including Disney’s traditional television networks as well as streaming services Disney+, Hulu and ESPN+.
DirecTV will be able to offer Disney’s streaming services in packages and a la carte, the company announced in a release Saturday. DirecTV also gained the rights to distribute Disney’s flagship ESPN direct-to-consumer streaming service, scheduled to launch in fall 2025, to subscribers at no additional cost.
The inclusion of Disney’s streaming service and ESPN’s future flagship service reflects a distribution deal agreed to between the two companies. Charter Communications Charter and Disney struck a deal last year after a similar broadcast shutdown. The companies struck a deal in time for the premiere week of “Monday Night Football.”
In a joint statement, DirecTV and Disney said the partnership gives customers “the ability to customize their video experience through more flexible options” and is “the first of its kind.”
The ban highlighted how valuable live sports is, both to the media companies that own the rights to broadcast the matches and to the pay-TV operators that want to show them.
Since Sept. 1, each side has accused the other of delaying a deal. DirecTV has called Disney an anti-consumer company, and ESPN Chairman Jimmy Pitaro called DirecTV’s response to Disney’s package proposal “basically what-if.”
The power outage appears to have caused losses for the company, its customers and other business owners.
“We definitely don’t want to go off the air. That’s not good for either party. It’s certainly not good for the customer. We’ve done everything we can,” ESPN’s Pitaro told CNBC last week.
The number of customers DirecTV lost during the dispute is not “insignificant,” DirecTV Chief Marketing Officer Vince Torres said at the Goldman Sachs Communacopia & Technology Conference on Thursday.
Torres said DirecTV stopped paying Disney as soon as the outages began and offered customers a $30 credit.
During the dispute, many small business owners were also unable to offer all of the sports programming they normally offer. Many bars and restaurants rely on DirecTV as their commercial distributor for their “Sunday Ticket” package of out-of-market NFL games (which were not affected by the outage), and also use pay-TV providers for the rest of their TV content, including ESPN.
Beyond sports, the outage also occurred during Tuesday’s presidential debate, preventing customers in some markets from accessing Disney’s ABC broadcast network.
Disney tried to temporarily allow DirecTV to offer ABC to its customers that night, but the pay-TV provider refused. DirecTV called it a public relations stunt and said it did not see a need to broadcast ABC because the debate was also broadcast by several other news networks.
Antitrust law in the media has come under scrutiny in recent weeks over Venu and Warner Bros. Discovery, Fox CorporationThe Disney partnership was temporarily blocked by a judge due to antitrust concerns. Fubo TV The original lawsuit was filed by DirecTV Echo Star‘s Dish has supported it ever since.
DirecTV announced last week that it had filed a complaint with the Federal Communications Commission alleging that Disney had failed to negotiate in good faith. The FCC has rules that require station owners to do so. Saturday’s announcement did not state the status of the complaint, but a source told CNBC that it “remains ongoing.”
The entire pay-TV bundle has been overhauled in recent years as customers have turned to streaming services and other forms of entertainment instead of the traditional structure. This shift has fragmented the media ecosystem, with live sports, particularly Disney’s ESPN, considered the linchpin that holds the bundle together due to its high viewership.
DirecTV is running an ad campaign to remind consumers that it’s more than just a satellite TV company — it also offers streaming bundles.
