Disney’s channels went dark on DirecTV on Sunday, leaving millions of subscribers to the satellite TV service without access to marquee networks like ESPN and ABC and cutting off viewership to the U.S. Open tennis tournament.
The dispute means that most of DirecTV’s roughly 11 million U.S. subscribers can’t watch ESPN; the ABC broadcast network, which airs the U.S. Open, was also blacked out for many customers.
The outage is the latest instance of a routine dispute between a television programming company and its distributor resulting in a service disruption. Typically both sides must agree to new terms every few years, and failure to do so risks alienating customers who have grown increasingly disenchanted with having to pay for traditional TV. In the long run, these carriage disputes are unprofitable for both parties, and they are usually resolved in a few days.
The contracts are usually written so they expire at periods of peak viewer interest, giving both sides an incentive to reach a deal before the channels go dark. Disney’s dispute with DirecTV was the latest example: the outage began on the eve of Labor Day, cutting off access for many customers who were settling in for the long weekend.
Disney has found itself at the center of other disputes with TV distributors fed up with paying high fees for channels like ESPN when the company is spending lavishly to produce shows for Disney+ and its other streaming services. A year ago, Disney was locked in a standoff with the Charter cable system that was resolved after the two agreed to a pact that gave Charter’s customers access to Disney’s streaming services at a lower rate.
The early hours of carriage disputes quickly involve lots of finger-pointing, with both sides blaming the other for making unrealistic financial demands that deprive customers of the channels they are paying for. In the streaming era, TV programmers sometimes encourage viewers to find their shows and events on a service like Hulu or Fubo that stream live sports.
In a statement, Disney said it believed DirecTV was offering to pay too little for its programming.
“We invest significantly to deliver the No. 1 brands in entertainment, news and sports because that’s what our viewers expect and deserve,” said the statement, from Dana Walden and Alan Bergman, co-chairmen of Disney Entertainment, and Jimmy Pitaro, the chairman of ESPN. “We urge DirecTV to do what’s in the best interest of their customers and finalize a deal that would immediately restore our programming.”
Rob Thun, DirecTV’s chief content officer, said in a statement that Disney is shifting content to its streaming services, while expecting higher prices from distributors.
“Disney is in the business of creating alternate realities, but this is the real world where we believe you earn your way and must answer for your own actions,” Mr. Thun said. He added: “Disney’s only magic is forcing prices to go up while simultaneously making its content disappear.”