• by Wayne Friedman , September 15, 2024

DirecTV-Walt Disney has struck a new carriage agreement to offer more packaging flexibility for consumers, for the first time including Disney streaming services Disney+, ESPN+ and Hulu, according to the companies' joint press release.

The agreement ends a high-profile, two-week impasse between the companies affecting around a dozen of Disney's networks, including its local TV stations. This includes ESPN, where new-season NFL and college football games were blacked out.

DirecTV has long complained about the need to give consumers smaller packages of TV networks at a lower cost, as well as competing with new alternative, streaming options in the marketplace.

For decades, major TV network/streaming owners typically have used mass=market leverage allowing them to place a majority of their networks onto pay TV cable, satellite, telco or virtual service.

For example, Disney has long demanded that its channels reach about 90% of DirecTV's subscriber base -- so-called “minimum penetration” levels.

If those levels are not reached, pay-TV services need to pay penalties. Currently, DirecTV has combined total 11 million satellite and internet subscribers for its service.

The companies say the new agreement will offer consumers “multiple genre-specific options -- sports, entertainment, kids & family -- inclusive of Disney’s linear networks along with Disney+, Hulu and ESPN+.

DirecTV says: “Thanks to new foundational rights from Disney, we will be able to launch more flexible and lower-priced genre-based options for sports, entertainment, kids and family, and more in the new year.”

For DirecTV, it also includes the ability to package streaming services together with linear TV networks such as Disney+, Hulu, and ESPN+. 

In addition, it allows DirecTV to distribute Disney's upcoming ESPN flagship direct-to-consumer service at no additional cost to customers.