Verizon says it doesn’t need permission from ESPN or any other TV programmer to break up the bundle.
Verizon Says It Doesn’t Need ESPN’s Okay to Break Up the Bundle
But it might be trying to get it anyway.
Verizon
Peter Kafka covered media and technology, and their intersection, at Vox. Many of his stories can be found in his Kafka on Media newsletter, and he also hosts the Recode Media podcast.
Speaking on the company’s earnings call today, Verizon CFO Fran Shammo told investors that the company’s deals with TV programmers allow it to offer a new “customized TV” plan, which gives subscribers the ability to mix and match different clusters of cable channels. On Friday, Disney’s ESPN said the new offering violates the network’s distribution agreement by moving its channels to a sports-only tier.
“We believe that we are allowed to offer these packages under our existing contracts,” Shammo told an analyst who asked if the carrier had “explicit permission” from Disney and other programmers to launch its new service.
An ESPN rep said the company didn’t have anything to add to its earlier statement, which said Verizon’s plan “would not be authorized by our existing agreements.”
Verizon’s plan gives pay TV customers a basic set of channels for a set price, then gives them the option to swap out different bundles of additional channels, grouped by themes like sports or entertainment. It’s a step toward “a la carte” TV, though it still doesn’t let consumers pick and choose individual channels.
While Verizon says it doesn’t need approval from Disney and other programmers to sell TV this way, it may be trying to get it anyway.
Last week, the company said it would start marketing the custom TV plans on Sunday. But so far it has been a very quiet campaign: Visitors to Verizon’s website have had to do some digging to get to a page explaining the company’s “customized TV plan,” and Verizon hasn’t had much to say about the plan on its Twitter and Facebook accounts. A YouTube ad promoting the plan, live since Friday, had 138 views as of this morning.
https://www.youtube.com/watch?v=d7zSSMbgNug
So perhaps Verizon would like to get a full endorsement from the programmers before it makes a big push.
Here’s the full text of Shammo’s comments this morning: “I think the right way to answer this without getting too public about our contractual situations — look, this is a product that the consumer wants. It’s all about consumer choice. I mean, if you look at the TV bundles today, most people only on average watch 17 channels. So this is a way to give consumers what they want on a choice basis. And we believe that we are allowed to offer these packages under our existing contracts. So we’ll leave it at that.”
This article originally appeared on Recode.net.
