Disney stock rose Monday after the Dow Jones entertainment giant reached a deal to end its pricing dispute with Spectrum owner Charter Communications. Charter stock climbed Monday.
Disney and Charter agreed to end the blackout fight that has been going on since late August, Disney announced Monday.
Disney will immediately restore its networks and stations to Spectrum, allowing millions of Charter customers to watch sports, including the kickoff of tonight's "Monday Night Football."
In the coming months, the ad-supported version of Disney+ will become available to customers who purchase the Spectrum TV Select package, as part of the wholesale arrangement. ESPN+ will be provided to Spectrum TV Select Plus subscribers, and ESPN's flagship direct-to-consumer service will be available for Spectrum TV Select subscribers when it launches. Meanwhile, Charter will offer a range of video packages and pricing plans based on customer viewing preferences.
"Our collective goal has always been to build an innovative model for the future," Disney CEO Bob Iger and Charter CEO Chris Winfrey said in a joint statement. "This deal recognizes both the continued value of linear television and the growing popularity of streaming services while addressing the evolving needs of our consumers."
Financial terms of the deal were not disclosed in the release but the Wall Street Journal reported that Charter agreed to pay higher rates for Disney channels and access to its streaming services for its pay-TV subscribers.
Sports Blackout
The House Of Mouse pulled its channels from Charter at the end of August after contract negotiations broke down between the two companies. Charter pays Disney for the right to broadcast its channels, which includes ESPN, FX, the SEC and ACC Networks as well as various local ABC channels. But the pair were unable to agree to a new price.
During the blackout, millions of Charter customers missed out on the U.S. Open, college football kickoff and the start of the NFL season. At the time Disney pulled its channels, Charter had about 14.7 million customers, CNBC reported. Meanwhile, Disney reported its Hulu + Live TV offering saw 60% more sign ups than expected during the period.
Charter executives held an emergency investor call on Sept. 1, the day after the blackout began. In the call, Charter executives lamented against the industry's flaws and the costly payment model. Charter proposed a new deal that would give Spectrum pay-for-TV (pay-TV) customers free access to Disney's ad-supported streaming apps. At the time, executives claimed Disney wanted Charter to pay license fees for customers that did not receive its services, which would require further price increases.
Disney Stock
Disney stock gained 1.2% to 82.52 Monday. DIS shares have tumbled from their March 2021 highs of 203.02 and are trading near their lowest levels since 2014. Disney stock has slumped more than 5% in 2023.
Charter stock swung 3.2% higher to 435.84 Monday. CHTR stock is trading near the top of a buy zone for a saucer base following an Aug. 2 breakout.
Media peers Warner Bros. climbed 2.3% Monday, while Paramount Global edged lower after surging in early trade.
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