Walt Disney Co. And Altice USA are at a standoff.
If they are unable to reach a deal before the end of the month, Disney has announced that it will pull its programming from the cable distributor. Meanwhile, Altice said Disney had asked it for “hundreds of millions of dollars” in new fees to continue carrying ESPN and ABC despite a drop in ratings, according to Reuters.
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Altice, which is better known as Optimum, is the nation’s fourth-largest cable distributor with more than four million subscribers, many of whom live in the tri-state area and parts of Pennsylvania. Subscribers reportedly began seeing scrolling messages on their TV screens on Friday night warning them that they may lose ABC programming.
Disputes between cable companies and media groups like this one are far from uncommon. However, Reuters notes that with ESPN as the most watched sports network, this is the first time a cable company has pushed back at increased fees for the channel. The change of approach comes only a month after Disney announced it would set up its own streaming service in 2019, pulling much of its most valuable content from competitors such as Netflix.
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But even ESPN’s ratings have declined in recent years as more more fans get game highlights and news online. According to the New York Times, the Altice contract is the first Disney distribution agreement to come up for renewal since the start of ESPN’s troubles. And Altice has claimed that Disney was seeking to force even those who do not receive ESPN to pay for it, suggesting that high fees were the cause of rising cable bills.
Unless the two parties come to an agreement on a new contract by the end of the week, Altice subscribers will lose access to ESPN along with all the other Disney-controlled networks, including ABC and Disney Channel. But a loss for Altice would also be a loss for Disney, as other cable distributors may try to turn down price increases in upcoming renewal talks as well.