Tue. Aug 21st, 2018

Disney and Altice USA Avoid Disaster, Reach New Deal

Altice USA and Disney announced both sides reached an agreement shortly after Sunday’s deadline. Disney was set to pull their networks from Optimum TV customers Sunday evening at 5pm if a new contract was not in place.

Details have not been released, but Disney will receive price increases for its major channels. In their previous contract with Altice USA, ESPN received over $7.50 per subscriber, the next highest cable channel is TNT at around $2.00 per subscriber. ESPN needs to charge distributors significantly more due to their broadcasting rights contracts. The network pays $1.9 billion annually to the NFL for “Monday Night Football,” and their NBA contract is a $1.4 billion expense.

In the era of cord cutting, with cable companies losing customers and ESPN losing subscribers, Disney’s ability to negotiate a price increase for its networks is a huge win. Disney has multiple contracts expiring in the next two years with cable companies larger than Altice USA. Had they agreed to a price decrease for their networks, it would have set precedent to also take a cut in their upcoming negotiations with Comcast and others.

Disney was ready to pull their networks from Optimum TV Sunday night. Reaching an agreement saved Optimum customers from losing WABC, The Disney Channel, Freeform, and ESPN. 2.6 million customers had no interruption of their service and will be able to watch “Monday Night Football” and MLB’s AL Wild Card Game Tuesday night.

Brandon Contes is a freelance writer for BSM. He can be found on Twitter @BrandonContes. To reach him by email click here.

Leave a Reply

Your email address will not be published.