Disney (DIS) and cable operator Altice USA (ATUS) have released a joint statement stating an agreement in principle has been reached, that the companies have extended Sunday’s deadline to finalize terms of the new deal and that ATUS would continue to carry DIS channels as negotiations continued. The deal ensures NYC area baseball fans can watch Tuesday’s Yankee-Twins playoff game (8p on ESPN). The dispute is rooted in the amount DIS wants ATUS to pay to continue carrying ESPN, ABC and other DIS channels on its Optimum cable service. In comments to the media, Altice has argued that Disney has asked for an “outrageous” increase over the terms of their expiring contract, considering viewership declines. DIS responded saying that ATUS charges their average customer $160/mo., with the “bulk of that money going in to their pocket”.
Howie Long-Short: Contract talks with Altice were the first of several Disney will have to have with cable operators over the next 2 years. In fact, contract negotiations over the next 24 months will cover more than 50% of Disney’s total pay-tv customer base; so setting the tone with this deal was crucial. DIS got a price increase (granted not as large as they had asked for) and convinced Altice to pick up carriage of the ACC & SEC networks. DIS won this round of negotiations and now appears well positioned moving forward. It’s clear cable operators will still pay for pricey sports channels despite viewership declines and streaming becoming more prevalent.
Fan Marino: Altice becomes the first cable provider to pick up carriage of the ACC Network. DIS plans to launch the new channel in 2019. NYC Optimum subscribers win here too; now receiving access to more P5 live game action.