Like a typical millennial, I don’t have a cable subscription, and I don’t have many friends who do. So when a few of us wanted to catch the live broadcasts from day seven of the U.S. Open, it was understood we would be doing so at a bar with TVs hooked up to a traditional network. We gathered Sunday at a spot that played the tournament through satellite provider DirecTV—which, in between tennis bouts, flashed urgent PSAs about the very channel we were watching. “DIRECTV & DIRECTV STREAM CUSTOMERS: YOU COULD LOSE THE ESPN NETWORKS,” the screen warned us in all-caps and in an array of colors, directing viewers to the Disney-owned website KeepMyESPN.com and imploring them to call 844-KEEP-MY-ESPN in order to avoid this. A thin banner presented the logos of the networks at stake: ESPN, Freeform, Disney Channel, National Geographic, and FX.
Like millions of other sporting fans across America, including those eager to catch the much-hyped USC-LSU football game, we’d been hit right in the face with the opening shots of a still-brewing war between Disney and DirecTV—one that, the world would soon find out, carried implications for the TV industry far beyond your typical boardroom squabble.
Those graphics weren’t new; another friend had previously encountered them on the digital ESPN stream, having logged on to the appropriate website with his parents’ account (hey, it’s just how we tend to do things). However, at 7 p.m., we encountered something that was new: a dark message, accompanied by a QR code and a suggestion to visit the website TVPromise.com: “Our contract with Disney, the owner of this channel, has expired. We appreciate your patience while we negotiate to offer you greater flexibility, choice, and value.” The bartenders scrambled to change our screens over to YouTube TV to make sure we could watch the U.S. Open’s second session, which started right at the moment DirecTV and Disney’s contract appeared to have expired.
The blast radius extended far beyond tennis-loving sports bars. Disgruntled would-be viewers pointed out online that the outage similarly affected their TV experiences on Delta airplanes, Seattle gyms, Hooters, Fuzzy’s Taco, and even the Disney+ app, since full ESPN access there (outside of ESPN+’s limited add-on) still depends on a cable login. DirecTV also has more than 11 million individual subscribers across its satellite offerings and its U-verse and DirecTV Stream services—and a lot of those customers have been keeping up with the college football season while looking forward to Monday Night Football. The whole mess also affected those who don’t care about sports, with DirecTV customers left unable to watch The Bachelorette’s controversial Monday-night finale on ABC—the channel that will carry the upcoming presidential debate and the Emmy Awards after that. (Local ABC affiliates are still able to broadcast through DirecTV, albeit not through DirecTV Stream.)
The United States Tennis Association is obviously disappointed with this state of affairs, but so is North Carolina Gov. Roy Cooper, who wrote a whole letter on Thursday to the CEOs of Disney and DirecTV, plus the chairman of ESPN, asking them, “on behalf of many North Carolinians who are frustrated and angry,” to resolve things ASAP.
It’s unclear when things will resolve, although Puck News’ John Ourand is guessing that, according to his “best sources,” Disney and DirecTV “will reach an agreement by early next week, probably before the Jets-49ers Monday Night Football game.” (DirecTV has said, however, that its ultimate decision will not be dictated by NFL hype.) It’s getting down to the wire, folks! And no matter what, there will be a lot of petty online sniping along the way.
The aforementioned PSA websites from both DirecTV and Disney are still live, although they’ve adjusted for the circumstances. KeepMyESPN.com now redirects to KeepMyNetworks.com, which recommends alternate streaming services and TV providers (e.g., Fubo, Sling, Dish, Verizon) before giving you options to contact DirecTV directly and complain—a campaign format that Disney is promoting across all its networks’ social media accounts. TVPromise now gives you the option to search for coverage updates in your geographic region and check if you qualify for the $20 subscription credit DirecTV is now offering.
The provider’s X accounts are still promoting college football—though it’s mainly pushing options that don’t require a satellite dish—and directly tagging the Big 12 Conference’s account, calling it out for “pocketing a billion+ from Disney in licensing fees while forcing fans to scramble for alternative ways to watch. Not cool.” (Spicy!) The replies to that tweet, however, may indicate that DirecTV is already losing in the court of public opinion: The more agitated viewers are asking just why the provider announced Friday that it would raise DirectTV Streams’ subscription prices by next month, with monthly cost hikes hitting all of its packages. (DirecTV stated that the move came in response to “TV networks … continuing to increase the fees they charge DIRECTV for the right to distribute.”)
Why are we in this position to begin with, where DirecTV and Disney have waged such public warfare that everyone—from casual TV watchers to the governor of an entire sports-loving state—is asking them both, in so many words, to get their shit together?
DirecTV Chief Financial Officer Ray Carpenter held a conference with Wall Street analysts on Tuesday to clarify more details. As Reuters characterized his argument, DirecTV had “pressed Disney to allow it to sell smaller, lower-priced packages, including tiers without ESPN for customers who do not watch sports”—an alternative to the “multi-channel fat bundles” of its vast array of properties that Disney purportedly wished to license. Essentially, DirecTV wants to give its customers extra subscription options that will also help it to save money in carriage fees paid to Disney—which can charge a heckuva lotta cash for an all-or-nothing parcel containing all the aforementioned brand names.
To quote Carpenter, this was just another existential fight for the perpetually embattled paid-TV sector that’s “really about changing the model in a way that gives everyone confidence that the industry can survive.” This stance is reflected in the tweets DirecTV has been issuing to customers threatening to cancel their subscriptions, with the social media manager framing the blackout as fallout from a “fight for customers,” a drag-out for which “disconnecting isn’t the answer,” because “the loss of sports, shows, and movies [affects] the entire industry, including streaming services.” A separate press release from DirecTV goes even further, if you can believe it, calling Disney “anti-consumer” and alleging that the entertainment juggernaut demanded unacceptable contract riders, in which DirecTV would “waive all claims that Disney’s behavior is anti-competitive” and be forced to stage all post-agreement litigation in California instead of New York (where parent company AT&T is based).
Disney, predictably, doesn’t see it that way. In a Wednesday statement co-signed by the chairs of both Disney Entertainment and ESPN, the conglomerate claimed that “DirecTV continues to misrepresent the facts” and implied that the carrier did not Disney also counters that it “has proposed a variety of flexible options” in lieu of DirecTV’s offers, and is accusing the satcaster of undermining the true value of Disney’s vast IP and distribution portfolio. However, in the spirit of fisticuffs, now both DirecTV and Disney appear to be undervaluing themselves: DirecTV is offering customers a $30 credit on their bills should they sign up for either Fubo or Sling, and on Disney’s end, you can get $30 off any Hulu With Live TV plan until Sept. 11.
There’s some supposition, including from Ourand at Puck, that the heat here stems from Disney’s secretive plan to establish a streaming-specific digital service, Venu Sports, in partnership with Warner Bros. and Fox. This three-headed hydra would package all the live sporting leagues covered by those three networks into a convenient one-off streamer, offering a more economical price for a product offering that, likely, would have attracted those who only keep their TV channels around for the sports. That launch was derailed, however, after sports streamer FuboTV sued in federal court on antitrust grounds and won an injunction from the judge, pending a potential jury trial. As a pay-TV network, DirecTV has been subject to the headwinds that have steeply injured traditional TV since the advent of the internet. Without Venu as a threat, sporting still constitutes one of the few live-TV options that hasn’t been completely cannibalized by streaming just yet. DirecTV knows that if it loses the ability to offer iconic and large-scale events like the U.S. Open, college football tourneys, NFL openers, political town halls, and awards shows, then it really has nothing left to keep buyers around.
In that sense, one could take the perspective of this battle as two modern-day megacorporations flexing their respective power and hoping to win by brute force. Disney is, of course, Disney, with a gargantuan amount of market power gained from decades of acquisitions and cuts. DirecTV, however, still is an important feeder of customers and revenue to the Disney pipeline. While Venu is held up in court, Disney would probably like to retain the access afforded by a wide-reaching network like DirecTV. And if it gave any concessions to DirecTV while flailing in court against FuboTV, that might indicate to investors that Disney—already sore from a stupid battle with Florida’s far-right government—is not nearly as mighty as it may appear.
Sorry if you’re a viewer left out in the cold by the DirecTV-Disney smackdown, but there are reputations to maintain here, thank you very much.
