Disney Looking to Prevent DIRECTV From Filing Antitrust Suits in New Carriage Deal
DIRECTV Chief Content Officer Rob Thun says the smaller packages Disney has offered to allow DIRECTV to sell still come with minimum penetration requirements.
The pressure is mounting on both DIRECTV and Disney to make a new carriage deal before the weekend. Fans risk losing out on Week 2 of the college football season on ABC, ESPN, ESPN2, and ESPNU, as well as the first NFL “Monday Night Football” game of 2024, if the situation is not resolved in the next few days. On Wednesday, Disney released a statement outlining its position and claiming to have offered DIRECTV two slimmed-down channel packages just as the satellite and streaming company asked for in negotiations. However, in an interview with CNBC, DIRECTV Chief Content Officer Rob Thun responded to the new statement from Disney, giving more details about what the House of Mouse has really offered.
Key Details:
- Thun said the skinnier bundles offered by Disney are still tied to minimum penetration requirements.
- The two sides have already agreed on the carriage rates DIRECTV will pay to Disney, Thun says.
- Disney’s offer is contingent on a pledge not to pursue antitrust cases against the company in the future or for past grievances.
Disney-owned channels were pulled from DIRECTV on Sunday, Sept. 1. Since then, the two sides have each tried to make their position as clear as possible to the public, while saying the other is engaging in an effort to obscure or misrepresent the truth.
“We’ve seen this before with Disney’s messaging, and it’s a half-truth,” said Thun when questioned about Disney’s offer to allow his company to sell a slimmed-down channel package with ESPN and ABC.
He explained that the proposal to sell this package as well as a smaller, entertainment-based bundle was still tied to minimum penetration requirements which force DIRECTV to carry the rest of Disney’s channel portfolio “to certain levels.”
Thun also said that contrary to Disney’s messaging, the companies have agreed on the actual carriage rates that DIRECTV will have to pay to continue offering Disney-owned channels in the future, but the fees aren’t the primary issue in the negotiations. There’s no knowing what those rates are because negotiations are confidential, but court documents in the Fubo lawsuit against Venu Sports — in which Disney is a co-defendant — showed that ESPN commands a carriage fee of $9.42 per subscriber, the highest of all cable channels.
No Lawsuits Allowed
Speaking of Fubo’s case against Venu, Thun told CNBC that one particularly onerous provision that Disney wants to include in any new carriage contract would be to forbid DIRECTV from pursuing antitrust remedies against the company, either for past or future grievances. DIRECTV has been an enthusiastic supporter of Fubo’s antitrust case against Venu, and it appears that Disney wants to put the kibosh on that type of behavior in the future.
Thun paints a picture of Disney as a company that still holds out hope of selling smaller-sized channel bundles like Venu to customers directly, instead of going through distributors like DIRECTV.
“They’re not letting us participate in the kids and family package that we put on the table to them because they want to keep that for themselves,” he said. “We just need the Walt Disney Company to let go of their singular control over the marketplace in some of these packages.”
The biggest area of common ground between DIRECTV and Disney is that they both see room in the marketplace for a smaller channel bundle that doesn’t force customers to pay for channels they’re not watching regularly. But they’re clearly still far apart on the best methods of delivering those bundles to customers.
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