Dish Network, the second-largest satellite television provider in the United States, could lose ESPN and other Disney-operated cable channels at the start of October.
Disney’s agreement with Dish Network is set to expire at the end of September, according to the Wall Street Journal. That agreement covers the ESPN and Disney line of channels as well as ABC-operated local stations in New York, Los Angeles, Houston, San Francisco and four other cities.
If Dish Network and Disney do not reach an agreement by the end of September, Dish would be forced to drop the channels until an agreement is reach.
On a conference call in August, Dish CEO Charlie Ergen hinted that digital rights could stand between an agreement with Disney. Along with several channels of television programming, ESPN currently offers customers of some cable companies the ability to watch live sports online if they first authenticate that they are a pay TV customer. While Comcast, Time Warner and Charter customers can take advantage of ESPN’s online stream, Dish Network customers aren’t, and Ergen likely wants to see that change.
“There’s rights that we don’t have today that we’d like to have,” Ergen said, “We’ll work first and foremost to find a deal with Disney that makes sense for our customers. If we get that deal, we’ll do it. If we don’t get that deal, we’ll part ways. Simple as that.”
Digital rights were a sticking point for Time Warner Cable’s recent carriage dispute with CBS. Both sides made it seem like Time Warner Cable and CBS were fighting over retransmission rights on cable TV, but the battle was really over rights to make CBS programming available to Time Warner Cable customers over the internet.
According to reports, Time Warner Cable wanted to make CBS-controlled programming available for free to its customers on mobile and tablet apps. Time Warner Cable didn’t feel CBS deserved any more money for those digital rights; CBS felt differently. With football season approaching, reports say Time Warner Cable caved to CBS’ demand for $2 per subscriber along with full control of its digital content.
That extra cost of carrying CBS will likely mean a price increase for Time Warner Cable customers.
“When we have to pay a lot more, it will have a long-term impact on customers’ bills,” a Time Warner Cable spokesperson told The Desk by email. “Rates are rising as programmers are demanding more money every year. Since 2008, negotiated programming costs for TWC have risen 30% while the video prices our customers pay have gone up by 15%. That’s why we fight to hold the line on TV costs.”
What happened at Time Warner with CBS likely won’t happen at Dish. Both Dish and DirecTV have been able to offer television service comparable to basic cable over the past years because satellite television platforms offer significantly less programming than digital cable. And while Dish would like to see Disney stay on its platform for many more years, Ergen seems unwilling to concede to the idea that channels like ABC Family and ESPN are a necessity, especially if those channels come at a higher cost (Disney currently asks for around $5 per subscriber just for ESPN alone).
“There could be a day when strategically, companies just can’t get together, where they go opposite directions and they both have strategies that work for them,” Ergen told analysts in August. “We’re prepared to go either way.”