Verizon, Disney reach agreement to end carriage spat
Morning Business Outlook: Verizon warns Fios TV customers that they may lose access to ESPN and The Disney Channel if they can't reach a new agreement with Disney; Ford, Toyota and Chevrolet are discontinuing some car models in 2019 as buyer preference shifts to SUVs.
Verizon and Disney reached an agreement to end a carriage spat that would have left some Fios customers unable to view ABC, sports giant ESPN and other channels owned by Disney, the two companies announced Sunday.
“Verizon and The Walt Disney Company have reached a broad-based distribution agreement. Details will be released in the coming days,” the companies said in a joint statement on Twitter.
The deadline for the two companies to reach an agreement was Dec. 31 at 5 p.m. ET. In the days leading up to that contract expiration date, Disney had begun to run messages on ESPN and local ABC stations owned by Disney, including WABC in New York and WPVI in Philadelphia, two major U.S. markets, according to Variety. One of the messages for Fios customers read “don’t lose your shows.” Verizon contacted its subscribers by email.
In its third-quarter, Verizon said it lost 63,000 video subscriptions, blaming the decline on “ongoing shifts away from linear video offerings.” Its consumer markets revenue decreased nearly 2 percent “driven by legacy core declines and cord-cutting,” the company said. Meanwhile, its Fios broadband internet gained 54,000 customers in the same quarter.
Verizon had approximately 4.6 million subscribers at the end of 2017.
Other media companies in the U.S. are facing similar situations, where millions of viewers could be affected by service disruptions. For example, Tribune Broadcasting warned that its contract covering 33 local stations in 24 markets, which affects 6 million viewers, is set to expire at 12 a.m. ET on Jan. 1, 2019. In addition to local news, it warns that NFL playoff games and college basketball games could be lost, while 14 million subscribers could lose access to WGN America, Tribune’s basic entertainment cable network.
“We want to reach an agreement with Spectrum," said Gary Weitman, Tribune Media's senior vice president for corporate relations. "We've offered Spectrum fair market rates for our top-rated local news, live sports and high-quality entertainment programming, and similarly fair rates for our cable network, WGN America. Spectrum has refused our offer."