Disney has escalated its carriage dispute with Charter Communications, the second-largest cable operator in the U.S., by asking its Spectrum TV customers to switch to Hulu+ if they want to access its channels and programming. The media giant said it has offered Charter the most favorable terms on rates, distribution, packaging, advertising and more, but the cable company has refused to accept them.
Disney channels and ABC stations go dark on Spectrum
The carriage dispute between Disney and Charter has resulted in a blackout of 18 Disney-owned channels, including ESPN, ABC, Disney Channel, FX and National Geographic, on Spectrum TV service since Thursday. Additionally, eight ABC stations in major markets such as New York, Los Angeles, Chicago and Philadelphia have also gone dark for Spectrum subscribers. The outage affects nearly 15 million customers across 41 states.
Disney said it is disappointed that Charter has chosen to deprive its customers of its popular and high-quality content, especially at a time when live sports and entertainment are returning to full swing. The media company said it has a history of successful deals with various pay-TV providers nationwide, and that the rates and terms it is seeking from Charter reflect market dynamics and the value of its content.
Charter wants to blow up the pay TV bundle in Disney fight
Charter, on the other hand, said it is prepared to “move on” from its video business if it cannot reach a “transformative” deal with Disney. The cable company said it wants to create a new collaborative video model that would allow customers to choose from competing pay-TV providers and streaming services that offer Disney’s direct-to-consumer (DTC) apps, such as Disney+, ESPN+ and Hulu+.
Charter argued that the video ecosystem is broken and that programmers like Disney are continuing to pursue DTC options at the expense of traditional linear TV. The cable company said it wants to provide a “glide path” for Disney to transition its flagship ESPN channel, the most valuable property in the pay TV bundle, to a DTC offering in a way that does not cannibalize its larger linear video revenues.
Disney asks Spectrum customers to switch to Hulu+
In response to Charter’s stance, Disney has issued a statement on Monday urging Spectrum customers to explore switching pay-TV services if they want to access its channels and programming. The media company said consumers have many options today and can choose from competing pay-TV providers that offer Disney’s entire portfolio of networks and programming, as well as TV streaming services that can be accessed by downloading an app or over a broadband connection.
Disney also highlighted its own pay-TV service, Hulu+ Live TV, which serves 4.3 million subscribers and offers live and on-demand access to more than 75 channels, including ABC, ESPN and other Disney-owned networks. The media company said Hulu+ Live TV is available for $64.99 per month with a seven-day free trial, and that customers can also bundle it with Disney+ and ESPN+ for an additional $13.99 per month.
Disney said it hopes it will be able to reach an agreement with Charter soon and restore access to its channels and programming for Spectrum customers. However, it also warned that the blackout could last for a long time if Charter does not accept its fair and reasonable terms.
