Disney Says New Verizon Bundle Violates Deals For All Of Its Networks, Including ESPN

Disney yesterday joined a chorus of media companies in saying that Verizon's "new, slimmer FiOS cable offering violated agreements with all of its cable networks," including ESPN, which earlier in the week refuted a claim it would be participating in the new plan, according to John Koblin of the N.Y. TIMES. Verizon on Sunday introduced its FiOS Custom TV plan that "gives customers a base package of 35 channels," and "several media companies were caught off guard." Disney’s channels are "spread throughout several tiers on the FiOS plan, with ESPN in sports, ABC Family in the pop culture plan and the Disney Channel and Disney Junior in the children's category" (N.Y. TIMES, 4/23). USA Today's Roger Yu writes it is "unclear exactly how Verizon may have breached ESPN's terms, if at all." But Recon Analytics Founder & Lead Analyst Roger Entner said that Verizon's move "could affect ESPN's bottom line in various ways." Yu cites data from SNL Kagan as showing that ESPN "receives $6.61 per subscriber per month from pay-TV providers." Entner added that if ESPN's "reach among Verizon's cable households shrinks as a result of the move, the sports giant may have to seek higher per-subscriber fees to make up for a possible loss in advertising revenue stemming from fewer viewers." SNL Kagan Research Dir Derek Baine said, "I think that there is significant risk that ESPN will take legal action" (USA TODAY, 4/23).