Due to the Carriage Fee Dispute, 19 Disney Channels, along with ESPN, gets blacked out on Charter Spectrum.
September 1st was a rude shock for Spectrum cable subscribers eagerly tuning in to watch ESPN‘s “SportsCenter”, only to find the channel had been blacked out.
This blackout arose from a disagreement over carriage fees, leading to 19 Disney cable channels and seven ABC stations nationwide becoming inaccessible for Spectrum’s audience.
The disagreement has, unsurprisingly, resulted in a blame game between the two companies. On a recent investor call, Charter Communications, the company behind Spectrum, opened up about their ongoing discussions with Disney.
Charter’s CEO, Chris Winfrey, shared insights into the company’s proposed “hybrid” distribution model to Disney. This model would have incorporated traditional TV with streaming. However, Disney wasn’t on board. The prolonged absence of Disney channels on Spectrum raises concerns about Spectrum losing customers to other providers.
Winfrey ominously hinted, “Our willingness for a resolution diminishes as we see a decline in video engagement. The chances of us adopting an entirely new video product structure increase significantly.” This possibly hints at Spectrum’s collaboration with Comcast on the new Xumo platform, featuring live TV streaming via Spectrum, on-demand content from NBCUniversal’s Peacock, and several free ad-supported TV channels. Winfrey mentioned that this platform might become the primary way Spectrum onboards pay-TV customers.
This standoff paints a vivid picture of the dwindling state of cable TV.
Estimates suggest a 25% drop in cable subscriptions over the last five years, with Charter boasting about 15 million pay-TV subscribers. The blackout means Spectrum viewers miss out on popular channels like ESPN, especially with the football season kicking off, potentially driving them to alternative providers.
Disney is aware of cable TV’s precarious state. Disney’s CEO, Bob Iger, has shown interest in selling off Disney’s linear channels to double down on movie studios and streaming. Plans are also afoot to collaborate with tech firms to create a standalone streaming platform for ESPN, eliminating the need for traditional cable.
This understanding prompted Disney to seek higher retransmission fees from Spectrum. While aiming to maximize short-term profits from its cable channels, Disney’s approach might nudge Spectrum towards a more streaming-centric strategy revolving around the Xumo platform.
Ragul Thangavel
With over nine years of diverse professional experience, Ragul has made significant contributions across various domains, including Media Operations, OTT Technologies, Video Production, Ecommerce, and Social Media.
Holding an Engineering degree, Ragul's career took an unconventional turn when he discovered his passion for writing, leading him to begin his journey as a content writer.
His career has been exclusively dedicated to the growth and development of startups, where he has played a pivotal role. His unique blend of technical knowledge and creative prowess has enabled him to drive innovation and success in every venture he has been a part of.