Disney DirecTV Dispute: The Disney-DirecTV dispute has become a big problem for satellite TV. Many customers have not been able to watch popular programs like Monday Night Football and the U.S. Open. The blackout started two weeks ago when the contract between Disney and DirecTV ended. This dispute is a sign of bigger troubles for satellite TV in general.
Why Is Satellite TV Struggling?
Satellite TV is facing many challenges today. Unlike cable TV, satellite companies like DirecTV and Dish Network do not offer internet services. This makes it easier for customers to leave satellite TV and switch to streaming services like YouTube TV, Hulu Live, or Fubo.
Cable companies like Comcast and Charter can offer both TV and internet, giving them an advantage. When channels go dark, cable TV customers may stay because they need internet. But for satellite TV, losing channels means people can easily cancel their service and switch to streaming.
Satellite TV also doesn’t allow viewers to watch content on-demand as easily as streaming services. Although you can record shows with a DVR, it still feels more like traditional TV. In the era of streaming, this is a disadvantage.
The Disney-DirecTV Dispute
The DirecTV and Disney dispute is about money. Disney wants to charge DirecTV more money for its channels, including ESPN and ABC. DirecTV argues that Disney’s prices are too high and that customers are being forced to pay more for less content.
Rob Thun, DirecTV’s chief content officer, has said that Disney is raising prices while making content disappear. He says Disney is putting its best shows and sports on its streaming service Disney+, making customers pay more for less content on traditional TV.
On the other hand, Disney says that DirecTV is undervaluing its channels. Disney claims that DirecTV is not paying enough for must-see programming like NFL games and popular shows.
DirecTV’s Decline
DirecTV is facing a big decline in customers. Just 13 million U.S. households now subscribe to satellite TV, a 15% drop from last year. This decline is faster than cable TV, which has also been losing customers but at a slower rate.
DirecTV is owned by AT&T and a private-equity firm called TPG. To stay competitive, DirecTV has tried to move into the streaming space. The company now offers DirecTV Stream, which is an on-demand TV service that does not require a satellite dish.
But the company still faces many challenges. Ray Carpenter, DirecTV’s chief financial officer, said they know that their competitors like Charter have other products, like internet, to offer. DirecTV is looking for a way to make their business work in the long term, but it’s difficult without internet services.
What’s Next?
The Disney-DirecTV dispute could end soon. Usually, these kinds of disputes get resolved within a few weeks because both sides want to avoid long-term losses. Disney still makes a lot of money from deals with traditional TV companies like DirecTV, and DirecTV needs ESPN to keep its customers happy.
Last year, Disney reached a deal with Charter after a short blackout. In that deal, Charter customers got access to Disney’s streaming services at a wholesale rate. It’s possible that a similar deal could happen between Disney and DirecTV soon.
However, even if the dispute ends, the bigger question is how much longer satellite TV can survive. With more people moving to streaming services, satellite TV may continue to lose customers in the future.
