Why DirecTV Users Can’t Access ABC, ESPN, and Other Disney Channels Now

Millions of DirecTV subscribers suddenly found themselves unable to access key Disney-owned channels like ABC and ESPN starting Sunday evening. This unexpected blackout has left many viewers, particularly sports fans, frustrated right as the college football season kicks off and the U.S. Open tennis tournament continues.

The root cause of the disruption is a heated contract dispute between Walt Disney Co. and DirecTV. The disagreement revolves around the financial terms of their deal, specifically the fees DirecTV pays Disney for broadcasting rights.

The channel outage commenced around 7:20 p.m. Eastern Time on Sunday, Sept. 1, catching viewers unprepared. The timing was particularly unfortunate, overlapping with high-profile sporting events. Tennis enthusiasts were left hanging during fourth-round matches of the U.S. Open, while college football fans missed the much-anticipated game between Louisiana State University and the University of Southern California.

According to Leichtman Research Group, DirecTV, with its 11.3 million subscribers, is the third-largest pay-TV provider in the U.S. Consequently, this extensive outage has impacted a significant part of the American television audience.

At the heart of this conflict are two major issues: escalating carriage fees and disagreements over channel bundling practices.

First, escalating carriage fees are a significant pain point. DirecTV has voiced concerns over the increasing costs demanded by Disney for broadcast rights. For example, ESPN’s monthly subscriber fee has reportedly surged by 40% since 2019, currently at about $10 per subscriber. DirecTV claims that the average customer is paying roughly $270 annually for Disney’s channels alone.

Second, channel bundling practices are in contention. DirecTV is advocating for more flexibility in offering channels to subscribers. The company desires to provide customers the option to choose smaller, tailored bundles of networks. This would allow viewers to potentially lower their costs by only paying for the channels they actually want to watch.

DirecTV’s CFO, Ray Carpenter, elaborated on this point, saying, “Customers are forced to buy these big, bloated packages to watch the Disney Channel. This leads to a higher cost and a lower value quotient.”

On the other side, Disney maintains it has offered “flexibility and terms” similar to those extended to other distributors. In a joint statement, Disney Entertainment co-chairmen Dana Walden and Alan Bergman, along with ESPN Chairman Jimmy Pitaro, expressed their stance: “DirecTV chose to deny millions of subscribers access to our content just as we head into the final week of the U.S. Open and gear up for college football and the opening of the NFL season. While we’re open to offering DirecTV flexibility and terms, we will not enter into an agreement that undervalues our portfolio of television channels and programs.”

In response, DirecTV has taken a robust stance against what it terms Disney’s “anti-consumer approach.” Chief Content Officer Rob Thun accused Disney of “refusing any accountability to consumers, distribution partners, and now the American judicial system.” Thun further stated, “They want to continue to chase maximum profits and dominant control at the expense of consumers—making it harder for them to select the shows and sports they want at a reasonable price.”

To mitigate the inconvenience caused by the blackout, DirecTV is offering a $20 credit to impacted subscribers. Customers can claim this credit by visiting the company’s website.

As of Tuesday afternoon, Sept. 3, there’s no clear indication of when the channels might be restored. DirecTV CFO Ray Carpenter described the situation as “not a run-of-the-mill dispute,” hinting that a quick resolution may not be forthcoming.

Such disputes are not new to the television industry. This marks the second consecutive year that ESPN has gone off the air during the U.S. Open due to contractual disagreements. These blackouts have become more frequent as media companies and distributors adjust to evolving consumer preferences and the rise of streaming services.

While most blackouts typically last from a few days to several weeks, some have gone on much longer. For instance, a dispute between The Weather Channel and Verizon resulted in a 1,567-day blackout for Verizon customers, according to S&P Global.

Source: CBS News, S&P Global