“Hey, Disney, remember we are in this together. Linear TV is going down the drain. You know it; We know it. Streaming is rising, as is cord-cutting of legacy pay TV. We need to make some big changes.”
One thing is for certain -- Charter does not want any long-term linear TV deal with any TV network group where traditional legacy pay TV programming issues are almost certainly going to get worse.
It's not even about paying for all that expensive sports programming now.
Cable operators are increasingly weary of TV network groups “cheating,” as it were, according to an analysis from Craig Moffett, senior analyst and co-founder of MoffettNathanson Research, when it comes to sports.
This comes with programmers slowly shifting -- either exclusively or not -- sports content to streaming platforms. For example, you can get some “Monday Night Football” games on Disney's streamer, ESPN+. You can also see NFL games on NBCUniversal's Peacock and Paramount Global's Paramount+.
Disney is sticking with the current situation, suggesting to Charter that its deal proposal is at “market rate” pricing -- presumably also made among other TV network groups with cable operators. Fair enough.
Charter says it at least needs flexibility -- that expensive sports networks are something a sizable portion of its consumers do not want. So perhaps it could pick and choose the networks under a new short-term plan -- try to make things more of “a la carte” business. Or perhaps it could carry a Disney streaming service at no cost to Charter.
From all this you can imagine Disney's response would be “no way,” not wanting to give up its long accumulated network leverage. If pushed, it might say "yes, we can do that. But we are going to charge you way more.” That would be rejected by Charter.
Should Charter now take a big swing? Blow everything up and completely drop Disney?
How would that go over with its consumers? How could it market the business currently -- a business that still brings in profits?
The betting says it won't do that. Compounding the industry averaging 8% annual “cord cutting” in subscribers, Charter could see perhaps double those declines.
Do Disney and/or Charter have time to work out a long-term plan unlike any other ‘blackout”-connected carriage agreements?
There may be more drama to come.