DirecTV, Disney reach deal to end blackout in time for college football

DirecTV and Disney A deal has been reached that brings Disney's ESPN and other channels back to the pay-TV provider's subscribers after a nearly two-week blackout.

The deal comes in time for college football this Saturday, which airs on ABC, ESPN, as well as the SEC Network and ACC Network, as well as the Emmy Awards, which airs on ABC. CNBC previously reported that a deal could be reached as early as Saturday.

Disney's networks went dark on September 1 after the two sides could not agree on terms of fees and bundle structures. The dispute left more than 11 million DirecTV subscribers without access to the U.S. Open, college football and this season's opening “Monday Night Football” game.

DirecTV executives began calling for the ability to offer skinny, genre-specific bundles to subscribers in the weeks leading up to the dispute and again when the Disney networks went dark. Disney said DirecTV's offerings don't reflect the quality its networks deliver.

On Saturday, DirecTV and Disney said they had reached an agreement that called for “market-based terms” for pricing.

The deal allows DirecTV to offer multiple genre-specific options, including sports, entertainment and kids and family, along with Disney's traditional TV networks, along with the streaming services of Disney+, Hulu and ESPN+.

DirecTV will be able to offer its packages and Disney's streaming services a la carte, the company said in a release Saturday. DirecTV also won the rights to distribute Disney's upcoming ESPN flagship direct-to-consumer streaming service — which will launch in fall 2025 — at no additional cost to its subscribers.

The inclusion of Disney's streaming service and ESPN's future flagship service echoes the agreement Carriage reached with both. Charter Communications And Disney followed a similar blackout last year. Charter and Disney reached an agreement for the first week of “Monday Night Football.”

In a joint statement, DirecTV and Disney called it a “first-of-its-kind collaboration” because it “gives customers the power to shape their video experience with more flexible options.”

The blackout made clear how valuable live sports are to both the media companies that have the rights to broadcast the games and the pay-TV providers that want to show them.

Since September 1, both sides have accused the other of holding a deal DirecTV called Disney anti-consumer, and ESPN chairman Jimmy Pietro called DirecTV's response to Disney's package offer “essentially speculative.”

Companies, their customers and other business owners seem to be lost through the blackout.

“We never want to black out. It's not good for either side. It's certainly not good for the customer. We've done everything we can,” ESPN's Pietro said on CNBC last week.

The number of subscribers DirecTV lost during the dispute was not “insignificant,” DirecTV Chief Marketing Officer Vince Torres said Thursday at Goldman Sachs' Communications & Technology Conference.

DirecTV offered its customers a $30 credit, funded by stopping payments to Disney as the blackout began, Torres said.

During the dispute, many small business owners were also unable to offer the full slate of sports that they normally do. Many bars and restaurants rely on DirecTV as a commercial distributor of the NFL's “Sunday Ticket” package of out-of-market games — which was unaffected by the blackout — and use pay TV providers for the rest of its TV content there, including ESPN.

Outside of sports, blackouts also occurred during Tuesday's presidential debate, leaving customers in certain markets without access to Disney's ABC broadcast network.

Disney wanted to temporarily allow DirecTV to offer ABC to its subscribers for that night, but the pay TV provider refused. DirecTV called it a public relations play and said it didn't believe it needed to open ABC because the debate was being broadcast on several other news networks.

Distrust of the media has been closely watched in recent weeks after Venu, the joint streaming venture A Warner Bros. invention, Fox Corporation. And Disney, temporarily blocked by a judge over antitrust concerns. Fubo TV Primarily suits and DirecTV and Anna EcosterIts dish supported it.

DirectTV said last week that it had filed a complaint with the Federal Communications Commission alleging that Disney did not negotiate in good faith. The FCC has rules that require broadcast owners to do so Saturday's release did not specify the status of the charges.

The entire pay-TV bundle has turned upside down in recent years as consumers turn to streaming services and other forms of entertainment instead of traditional structures. The move has fragmented the media ecosystem, and live sports — especially Disney's ESPN — are considered the linchpins holding the bundle together because of high viewership.

DirecTV is in the midst of an ad campaign to remind consumers that it's more than a satellite TV company — it also has a streaming bundle.