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STATES CHRONICLE – Walt Disney Co. opened a new chapter with the New Yorkers by continuing its partnership with cable provider Altice USA Inc. The two behemoths drew a preliminary programming deal together.
The new offer will re-invite 2.4 million TV subscribers from the New York area to their favorite channels. Therefore, people will be able to enjoy ESPN, Disney Channel, and ABC again.
Optimum Subscribers Were Close to Losing Valuable Channels as of Sunday Night
On Sunday, a joint email on behalf of both Walt Disney and Altice USA reached the masses. The statement only informed TV subscribers that both companies are going to prolong their partnership. As per previous notifications, New Yorkers with Optimum cable contracts were ready to take their farewell of Disney content on Sunday night.
“We have reached an agreement in principle and have extended the deadline accordingly to try and finalize the terms.”
The conflict appeared when Disney importuned Altice with claims of adopting ESPN channel as well as its own entertainment ones. Altice wasn’t ready to embrace this new chapter due to high pecuniary demands that Burbank asked in exchange for ESPN. As of lately, this channel in particularly faced rating declines and subscriber losses. These events don’t justify the high price.
Contrary to its performance, ESPN has become the most expensive network. TV subscribers have to cover $7.54 for access to this sports channel alone per month. By comparison, 11 cable channels under Disney ownership cost around $12.58 per month.
The New Programming Deal Appeared after a Concession on Behalf of Altice and Not a Price Reduction
The new programming deal is a certification of the fact that Disney and other TV operators are not ready to give up on sports channels. This rejection to adapt to a time when subscribers watch less sports content costs companies a lot.
Disney has to keep up with massive sports rights fees. For instance, NFL demands $1.9 billion a year for “Monday Night Football.” At the same time, the NBA contract levels up charges with additional $1.4 billion a year.
As a result, Disney must produce extra $450 million annually by 2021 to indulge the inflation in its deals with sports content providers according to a MoffettNathanson Research report. However, Disney is still an important entertainment source that attracts 14% of Optimum prime customers for Altice to quit this partnership. Therefore, Altice decided to keep up with its partner’s demands, no matter how expensive this can get.
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