Are Disney-Owned Channels Like ABC and ESPN About to Go Dark on DIRECTV, DIRECTV STREAM?
Are Disney-Owned Channels Like ABC and ESPN About to Go Dark on DIRECTV, DIRECTV STREAM?
Disney and DIRECTV have an upcoming carriage negotiation, and the recent Venu Sports ruling could embolden DIRECTV in those talks.
Disney was handed a stunning legal defeat last week in its attempt to bring a new streamer to life. The House of Mouse, along with Fox and Warner Bros. Discovery, combined to create Venu Sports, a streaming service offering 14 sports-related channels including ESPN, FS1, and TNT. The service was announced in February, but before it could be brought to market as intended on Aug. 23, it was slapped with a temporary injunction requested by Fubo as part of an antitrust lawsuit against Venu. DIRECTV has been highly supportive of Fubo’s efforts to stop Venu from reaching customers, but now it must sit across the table with Disney and try to iron out a new carriage deal for Disney-owned networks like ESPN, Disney Channel, and more.
Key Details:
- Disney last agreed to a five-year carriage deal with DIRECTV in September 2019.
- ESPN commands the largest carriage fee of any cable channel, but DIRECTV could ask for a lower rate.
- There’s a good possibility DIRECTV will pursue a deal in which customers get free access to on-demand Disney streamers.
As reported by John Ourand of Puck News, the last time Disney and DIRECTV came to a new carriage deal was in 2019 when the two sides forged a five-year pact. Those negotiations came down to the wire, and Disney warned DIRECTV that they might lose access to channels like ESPN, ABC, Freeform, and Disney Channel unless the satellite company acquiesced to its demands.
The channels did not get pulled from DIRECTV airwaves in the end, but the upcoming carriage negotiations between the two sides could get even more contentious. If DIRECTV feels its hand has been strengthened by the Venu ruling, it could push for steep concessions from Disney this time around. The company filed a letter of support of Fubo’s lawsuit against Venu back in April, and was quick to issue a statement to The Streamable following the injunction ruling in Fubo’s favor on Friday of last week.
“We are pleased with the court decision and believe that it appropriately recognizes the potential harms of allowing major programmers to license their content to an affiliated distributor on more favorable terms than they license their content to third parties,” DIRECTV Head of Communications Jon Greer said.
Has Venu Lawsuit Hurt Relations Between Disney and DIRECTV?
After speaking with DIRECTV Chief Content Officer Rob Thun on Tuesday, it’s clear to me that DIRECTV is not on the best footing with the Venu partners at the moment. Thun could not confirm that carriage talks are upcoming, since those contracts are strictly confidential from a legal standpoint.
However, he did tell me that it was disappointing that details about Venu’s potential to disrupt pay-TV had to come out in the discovery phase of the trial, and were not offered by the companies more freely. Disney CEO Bob Iger said in March that Venu would be targeted more at cord-cutters and cord-nevers, people who had already canceled their pay-TV subscription or had never signed up for one in the first place. But during the trial, ESPN chairman Jimmy Pitaro was confronted with evidence turned over by the Venu team during discovery that showed that up to two-thirds of Venu subscribers would cancel their current cable, satellite or live TV streaming plans in favor of the joint venture.
Thun did not hide his frustration at that lack of transparency from Disney’s side during our conversation, which suggests that carriage negotiations between Disney and DIRECTV could grow contentious the next time the two companies sit down. The negotiations are already expected to be fraught enough; ESPN commands the largest carriage fee of any cable channel on the market at $9.42 per subscriber, and Disney is creating multiple new streaming options for the channel outside of Venu. That will give distributors like DIRECTV even less incentive to continue paying such a high carriage rate for the channel.
What Could DIRECTV Ask For in Carriage Talks?
If carriage negotiations go sideways between Disney and DIRECTV, it could lead to Disney-owned channels being blacked out for DIRECTV customers. Viewers may only get a few days of warning before it happens, and if talks are indeed coming between the two sides in September, the start of the 2024 college football and NFL seasons could be jeopardized by the removal of ESPN, ABC, and other networks. Likely both sides believe this gives them some level of leverage in carriage discussions.
Aside from a potential request for lower carriage fees, DIRECTV could ask Disney about packaging its subscription streaming services with its pay-TV packages. Charter Communications made free access to Disney streaming services for its Spectrum cable customers a required stipulation in a new carriage contract when the two sides negotiated last fall, and Disney reluctantly agreed in order to get ESPN and other channels back on Spectrum airwaves before the 2023 NFL season.
In a blueprint for the future of the industry released on Wednesday, DIRECTV discussed the importance of making streaming easier for customers by allowing them access as much content from a single interface as possible.
“Consumers want access to their favorite shows and sports and the ability to discover new content in one complete experience – live ‘linear’ TV or on-demand content from DIRECTV or a third party – instead of through numerous disjointed entry points while managing multiple individual subscriptions to those products,” the company said.
DIRECTV has had discussions with Disney, Fox, WBD, and other programmers about bundling subscription streaming services with DIRECTV packages, but wants to ensure the right streamers go with the right content packages. As Thun explained, not all news watchers who come to DIRECTV for its cable news access enjoy general entertainment or kids’ shows, and so making a deal that just gives all customers access to Disney+ or Hulu doesn’t necessarily make sense.
Still, there do seem to be opportunities, especially when the ESPN streaming service currently dubbed “Flagship” comes to market in 2025. That service could be a perfect candidate to bundle with the DIRECTV CHOICE package, which includes regional sports networks in applicable markets, turning the plan into an ultimate sports destination. Thun says DIRECTV is continuing to reach out to companies with streaming services to see what makes sense for both sides, and it wouldn’t be a surprise to see the company craft a deal that includes on-demand streaming access to a Disney service in their next carriage talks.
There’s also the matter of smaller channel packages to discuss. At the heart of Fubo’s lawsuit against Venu was the fact that it was not allowed to create channel lineups on the scale of the joint venture because channel owners have typically required distributors to pay for less popular networks in order to gain access to their most beloved channels.
Thun explained that DIRECTV would like to create smaller channel packages not just for sports lovers, but for news watchers and entertainment diehards as well. Genre-based programming can be a boon for distributors and channel owners alike and will help customers trim the fat off channel inventories until they have a package with the content they want most.
“Consumers want the ability to choose from genre-based programming without piecing together and purchasing an extensive lineup of channels that don’t meet their desires,” DIRECTV said in its Wednesday release. “Consumers want price points closer to the [direct-to-consumer] options they are familiar with and the ability to pay for all their programming through one platform.”
DIRECTV understands the pressures that customers are under financially, especially as the cost of streaming goes up. Thun cited a recent Kantar study which showed that the average household now stacks five streaming services, as well as data from the Financial Times which showed that the cost of the top six on-demand streamers surpasses $87 per month, more than the $83 monthly average cost of a cable plan. Cable distributors and streaming operators can work more closely together to bring costs down, instead of viewing each other as enemies, and that dynamic could play out in DIRECTV’s upcoming negotiations with Disney.
But before a deal is struck, it seems some fences need mending between Disney and DIRECTV. The satellite and streaming company is feeling like it didn’t get the most honest representation of Disney’s intentions regarding Venu, and that could lead to a contentious round of carriage negotiations. If talks go too far off the rails, a carriage dispute could erupt which would cause Disney-owned channels like ESPN, Disney Channel, and others to be pulled from DIRECTV’s lineup until the two sides agree on a deal. Fortunately, there appears to be at least a little bit of time for the two companies to find common ground, and plenty of reasons for them to avoid the worst-case scenario.
DIRECTV
DIRECTV is one of The Streamable’s top choices for the best live TV streaming service overall in 2026, especially for users who want the most channels or want to watch the most live sports. With an unbeatable lineup of local, news, sports, and entertainment channels, three main signature packages, an unlimited DVR, and 20 simultaneous streams at home, DIRECTV remains a premier choice for any cord-cutter.