Disney Requests Dismissal of DirecTV's Bad Faith Complaint in Carriage Dispute

At the beginning of September, DirecTV customers were not happy to learn that they could no longer access any Disney-owned channel through their provider. The carriage agreement between Disney and DirecTV had expired on September 1, and the two sides had yet to come to an agreement. So, naturally, the customers paying a premium price were the ones left out in the cold.

For weeks, the two sides debated, trying to find a solution that would benefit everyone. Meanwhile, customers were getting more and more frustrated, frequently calling out both Disney and DirecTV.

Credit: Inside the Magic

DirecTV claimed that Disney was attempting to force it into bundling arrangements that included channels less favored by consumers, while Disney countered by suggesting that DirecTV was being unreasonable in its demands. This heated Exchange raised concerns among subscribers about the degrading nature of cable television, as both companies appeared more concerned with their corporate interests than the needs of their customers.

Central to the dispute were demands from DirecTV for customizable or “skinny” channel packages that would allow consumers to select only the content they wanted, without being forced into larger bundles that included less-desirable programming.

Three teenagers in a school hallway look surprised and concerned. A young woman on the left in a white shirt grips the arm of a young man in the center, who wears a green shirt, while another young woman on the right in a pink striped shirt looks shocked. — Credit: Disney Channel

Conversely, Disney has traditionally insisted on maintaining its bundling strategy to ensure the economic viability of its networks.

Following the intense negotiations, Disney and DirecTV reached a tentative agreement on September 14, 2024. This new deal reinstated access to all previously blacked-out Disney channels, including ESPN, ABC, and others. The terms include provisions for DirecTV to offer a range of Disney content across various platforms, including a commitment to bundle Disney’s streaming services along with traditional cable offerings.

However, the fight between Disney and DirecTV isn’t over quite yet.

disney-channel-hits — Credit: Inside The Magic

Disney has formally requested the dismissal of DirecTV’s complaint, accusing it of negotiating in bad faith during recent carriage negotiations. According to Disney, DirecTV has mischaracterized the negotiations and misconstrued earlier rulings by the Federal Communications Commission (FCC). Disney asserts that the recent claims made by DirecTV lack evidence of any wrongdoing on its part.

Furthermore, they argue that the negotiations were conducted in accordance with industry standards, and any perceived failures were primarily due to differing perspectives on package offerings. Disney emphasizes that a thorough examination of the negotiation history would reveal its commitment to acting in good faith.

Disney Channel Movies — Credit: Disney Channel

The FCC’s role in this dispute has drawn attention, as regulatory bodies typically do not intervene in privately negotiated carriage agreements. Disney maintains that the FCC’s jurisdiction is primarily concerned with whether parties are negotiating in good faith, rather than enforcing contractual obligations.

As a result, Disney is confident that the dismissal of DirecTV’s accusations is warranted.

Do you think Disney acted in bad faith during its negotiations with DirecTV? Let us know in the comments!