Monday, March 3, 2014

Key Points In Dish/Disney Deal

Disney and The Dish Network have been known to butt heads in the past but now it seems like a truce has been agreed on.

In the new multi-year deal, Dish and Disney have agreed to the following terms:
  • Dish will no longer feature it's controversial ad skipper technology on ABC shows for the first three days after the show debuts.
  • Dish will add all of Disney's new channels to it's lineup including: Disney Junior, Fusion, SEC Network and the Longhorn Network
  • Dish subscribers will now have access to ESPN3 action and will be able to watch the live feeds of all ESPN TV networks via WATCH ESPN app as long as they can prove they're Dish subscribers using their Dish username and password.
  • Subscribers will also be able to watch ABC, Disney Channel and ABC Family shows on-demand.
Here are the two biggest points regarding this new deal:
  • Dish will be able to stream any of the Disney/ESPN channels online through an over-the-internet subscription service. This means that Dish could start their own version of their service online and it could legally include any of those channels in their lineup.
    • Dish already has an internet subscription service known as DishWorld, but that specializes exclusively on international channels from around the world. With this new deal, there's no doubt that Dish will be looking to expand DishWorld's reach and value by adding Disney/ESPN channels.
    • DishWorld has an internet package which strictly includes sports only. With this new deal, the package's value will increase (as will cord cutting) should Dish decide to add ESPN channels on it. 
    • Adding ESPN channels will be a big help to networks that offer international sports programs but don't get as much promotion or attention: BeIN Sports and One World Sports
    • In reality though, I think it's wishful thinking to assume Dish will add ESPN, ESPN2 or ESPNU to the DishWorld internet service because it'll hurt their core satellite business. 
      • A young person who already watches most of his TV on Netflix and Hulu is probably only keeping Dish Network because of live sports programming on ESPN. If Dish is offering the same ESPN networks he gets on his TV online for a cheaper price (DishWorld Sports package currently costs $10 a month) then there's no reason for him/her to keep the Dish television service which is somewhere near $100 a month.
    • The most likely outcome when it comes to ESPN networks on a Dish internet service is for Dish to offer channels with some of ESPN's content specifically for an internet audience. For example, last week ESPN announced that it would create dedicated 24-hour conference feeds of live/on-demand content for conferences like the ACC and Missouri Valley Conference who don't have their own TV networks.
    • Offering those kinds of channels is still a coup for Dish and it's way better than what is available now on their online sports pack. It'll still be of big help to BeIN/OWS etc. who'll probably experience something similar to what WeatherNation is experiencing with the boosted promotion from DirecTV. 
      • In a perfect world for BeIN/OWS or the Nautical Channel (another network featured on DishWorld Sports), some of their content could even be featured on ESPN if the relationship works out well. Although we don't live in a perfect world and that's unlikely to happen.
    • The ability to stream ESPN nets online could even help Dish negotiate deals with content-creators who're willing to pay Dish or forgo carriage fees to get their content streamed in the same placement on the channel lineup next to ESPN nets. In this new world where conglomerates dominate channel placement, some independent nets are willing to pay cable operators or forgo their carriage fees to air their content in exchange for a relationship. (SEE: Netflix/Comcast - Netflix pays Comcast for higher streaming capabilities OR Justice Central - signed 10 year deal with AT&T cable in exchange for no fees on AT&T's part)
    • As mentioned before, Dish probably won't stream the regular ESPN TV nets to avoid hurting their main product BUT the fact that a big conglomerate like Disney gave Dish the ability to let their TV networks stream on an online subscription service shows that the future is coming quicker than we expected.
  • On another note, the future of ESPN Classic as a 24/7 linear channel is now bleak. As part of Dish's deal, ESPN Classic will turn into an on-demand channel. This makes more sense than a 24/7 networks because there's no fanbase that's willing to watch classic sports on a consistent basis anymore. An on-demand platform gives ESPN the ability to showcase it's archives to viewers without the pressure to garner advertisers for a low-in-demand product.
  • EXTRA SIDENOTE: I'm also really happy for Fusion! This channel is definitely the cable news channel of the future for the future. I'm glad it'll finally be accessible to audiences on television. 
    • Long-term though, if Fusion gains a lot of carriage in the next 5 years and doesn't see a major peak in ratings and revenue, I hope ABC and Univision continue the partnership online and try their hardest to build an online video powerhouse which competes with Vice. Fusion's content is very high quality but no one is seeing it because it's not on YouTube and no one gets the channel on TV. If it were on YouTube, it would generate a lot of ad money for ABC/Univision. We'll see if the TV bet (which is more lucrative than online) works in the long run.
  • ONE MORE SIDENOTE: I wonder if Disney/ESPN content will be added onto Dish's Blockbuster online Netflix-competitor service. I also wonder if there's any clause about whether Dish will carry ABC and it's affiliates should ABC decide to leave the affiliate model sometime over the course of this deal or if ABC sells it's affiliates to someone else. I also wonder what happens if Disney launches another new network during this deal, is that automatically included? 

1 comment:

Mary Patric said...

Thanks for the article Jessie. ABC Go offers some great shows and of course the ABC live feature. If you don’t live in US, you can use UnoTelly or similar tools to access it in your country.

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