The standoff between DirecTV and Disney over a new carriage agreement has escalated as it entered its second week. DirecTV filed a complaint with the Federal Communications Commission on Saturday night, accusing Disney of negotiating in bad faith.
Since the evening of September 1, Disney channels, including ESPN and ABC-owned stations in nine markets, have been unavailable on DirecTV. This blackout has prevented DirecTV customers from viewing most college football games and the final week of the U.S. Open tennis tournament, including the women’s and men’s finals. DirecTV, which has 11.3 million subscribers according to Leichtman Research Group, is the nation’s third-largest pay TV provider.
ABC and ESPN are scheduled to air the “Monday Night Football” opener between the New York Jets and San Francisco 49ers. In addition, ABC will produce and carry a presidential debate between Kamala Harris and Donald Trump on Tuesday in Philadelphia. The affected ABC-owned stations include those in Los Angeles, the San Francisco Bay Area, Fresno, California, New York, Chicago, Philadelphia, Houston, and Raleigh, North Carolina. Besides all ESPN network channels and ABC-owned stations, Disney-branded channels Freeform, FX, and National Geographic are also dark.
DirecTV’s 10-page complaint asserts that Disney is violating the FCC’s good faith mandates by demanding the waiver of any legal claims on their anticompetitive actions, including ongoing packaging and minimum penetration demands. DirecTV has requested that Disney allow for the option to provide consumers with cheaper and slimmer bundles of programming, rather than larger bundles that include content some viewers might not be interested in.
The complaint states: “Along with these anticompetitive demands, Disney has also insisted that DirecTV agree to a ‘clean slate’ provision and a covenant not to sue, both of which are intended to prevent DirecTV from taking legal action regarding Disney’s anticompetitive demands, which would include filing good faith complaints at the Commission. Not three months ago, however, the Media Bureau made clear that such a demand itself constitutes bad faith.”
During a conference call with business and media analysts on Tuesday, DirecTV CEO Ray Carpenter emphasized that they would not agree to a new carriage deal with Disney unless there were changes to the bundling. “We’re not playing a short-term game,” Carpenter said. “We need something that is going to work for the long-term sustainability of our video customers. The resolve is there.”
Disney has maintained that mutual release of claims is standard practice following the negotiation and agreement of licensing deals, citing past renewals with DirecTV as examples. A Disney spokesperson stated, “We continue to negotiate with DirecTV to restore access to our content as quickly as possible. 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.”
Last year, Disney and Charter Spectrum, the nation’s second-largest cable TV provider, experienced a nearly 12-day impasse that concluded just hours before the first Monday night NFL game of the season.
