Light Reading
Sweeping, multiscreen video content rights pact between Disney and Dish Network sets the stage for both programmers and pay-TV providers to go over the top.

No Mickey Mouse Deal for Dish

Alan Breznick
3/4/2014
50%
50%

With just a couple of pen strokes, the Walt Disney Co. and Dish Network have altered the landscape for the streaming of traditional TV programming to multiple screens inside and outside the home.

Walt Disney Co. (NYSE: DIS) and Dish Network LLC (Nasdaq: DISH) announced a landmark pact Monday night that will allow Dish to become the first US pay-TV provider to stream ESPN, Disney Channel, ABC, ABC Family, and other popular Disney-owned networks to broadband subscribers. Thus, the deal enables Dish, the third-largest pay-TV provider in the US, to establish its own, over-the-top (OTT) video subscription service that could potentially compete with conventional pay-TV services.

As spelled out in the Disney press release announcing the agreement, the deal "grants Dish rights to stream cleared linear and video-on-demand content from the ABC-owned broadcast stations, ABC Family, Disney Channel, ESPN, and ESPN2 as part of an Internet-delivered, IP-based multichannel offering." Further, "Dish customers will be able to access Disney's authenticated live and video-on-demand products, including WatchESPN, WATCH Disney, WATCH ABC Family, and WATCH ABC using Internet devices in the house and on the go."

While Dish officials have not spelled out when they will launch such an OTT service, they are clearly working on it. On the company's fourth earnings call with financial analysts late last month, Dish Chairman Charlie Ergen said the company is also negotiating with other major programmers for multiscreen streaming rights so it can go OTT. "When they're ready, we'll be ready," Ergen said.

In a note to clients Tuesday morning, Craig Moffett, a principal and senior analyst for MoffettNathanson, said it appears that a Disney-Dish OTT service would initially target just the 5 million to 10 million US broadband homes that don't subscribe to a traditional pay-TV service. That way, he said, Dish would deliver Disney content to more homes without cannibalizing Disney's huge cable, satellite, and telco TV customer base. "As we have heard in our prior discussions with other OTT startups, content owners have been focused on creating bundled structures that limit the risk of a la carte disintermediation," Moffett wrote.

Even if that's so initially, though, the genie will be firmly out of the bottle. Once such an OTT service gets off the ground, it will be difficult, if not impossible, for Dish and Disney to restrict it to just broadband-only subscribers. Plus, there would be nothing stopping existing pay-TV subscribers from simply cutting the video cord and then opting for the broadband video bundle instead.

The ground-breaking deal between Dish and Disney also sets the stage for Disney to strike similar multiscreen streaming deals with other major service providers, such as Comcast Corp. (Nasdaq: CMCSA, CMCSK), Time Warner Cable Inc. (NYSE: TWC), DirecTV Group Inc. (NYSE: DTV), Verizon Communications Inc. (NYSE: VZ), and AT&T Inc. (NYSE: T). Several of those provides have already indicated interest in going OTT at some point, especially Verizon with its recent purchase of Intel Media's OnCue cloud TV platform. (See Verizon Snatches Intel Media Assets.)

None of those providers may have the exact same leverage as Dish, which has been battling with Disney for months over the AutoHop ad-skipping feature of the satellite TV provider's Hopper DVR. In return for the OTT rights to the Disney channels, Dish agreed to disable the AutoHop functions for ABC content within The Nielsen Co. 's three-day TV ratings window. In turn, Disney agreed to drop its lawsuits over AutoHop. (See DISH Upgrades Hopper Software.)

But, like Dish, the other major pay-TV providers should still have plenty of clout in their negotiations because Disney is also seeking to gain greater carriage of some of its younger networks, especially its latest college sports networks, SEC ESPN Network. In the deal with Dish, for example, Disney won satellite TV carriage of such newer digital channels as Disney Junior, Fusion, ESPN Goal Line, ESPN Buzzer Beater, Longhorn Network, and the soon-to-be-launched SEC ESPN Network.

Likewise, the Dish-Disney deal clears the way for other major programmers to strike streaming pacts with the big pay-TV providers. Although several programmers have already moved in that direction, others have held off, fearful of cannibalizing their existing pay-TV customer bases.

So it's no longer a question of whether pay-TV providers and programmers will go over-the-top. The real questions are who will go first and how soon. And the answer to the first question appears to be Dish Network.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

(6)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
3/6/2014 | 12:47:48 PM
No Mickey Mouse Deal for Dish
@albeznick, that would be interesting; they are certainly in a position to move that way.  They have several moves they can make to increase their market position - all favorable as I see it.

DHagar
albreznick
50%
50%
albreznick,
User Rank: Blogger
3/5/2014 | 9:42:21 PM
Re: No Mickey Mouse Deal for Dish
OK. So to me the big question is whether Dish will take this budding OTT service nationwide and actually compete with its own satellite TV service, as well as all other traditional pay TV providers. Wouldn't it be fun to see Charlie Ergen compete with himself? 
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
3/5/2014 | 12:10:33 PM
No Mickey Mouse Deal for Dish
@kq4ym, interesting question.  I vote that it is that they are taking this road to retain customers plus attract the untapped market of customers not paying for TV.

DHagar
kq4ym
50%
50%
kq4ym,
User Rank: Light Sabre
3/5/2014 | 10:55:13 AM
Re: No Mickey Mouse Deal for Dish
One might wonder is the Disney/Dish deal was just a way to settle the lawsuit over Dish equipments ability to scrub commercials. Or, a way to allow Dish to gain or reatain customers who might be thinking of cutting the cable. But, unless a new tech overruns streaming content, the probable future of enterainment programming, the cable/satellite companies have to be alert to find ways to maintian their high profit margins.
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
3/4/2014 | 10:41:44 PM
No Mickey Mouse Deal for Dish
@MikeP688 - Exactly, This Disney/Dish deal changes the context and level of competition.  I believe they will set a higher standard of options and the bundled combination will be highly attractive.  This could be a win/win for everyone.  While Comcast is focusing on dominating, this appears to be a new model of offerings.

DHagar
MikeP688
50%
50%
MikeP688,
User Rank: Light Sabre
3/4/2014 | 8:57:56 PM
..and Dish will have the bandwith to deal with it...:-)
Dish swept all the latest wireless spectrum access which will give it further capabilities as it broadens its reach and creates the alternatives,  I have to wonder how  the new "Comcast/TWC" juggernaut emerging will deal with this challenge. 
More Blogs from Breznick Unbound
As expected, US cable broadband subscribers pass cable video subs for the first time in latest report from Leichtman Research Group.
While the No. 2 US MSO is accelerating plans for all-digital video and broadband speed upgrades, it's still desperately playing catch-up.
In yet another attempt to conquer the TV set, Google is launching its Android TV operating system for the big video screen. But will it succeed where other attempts have failed?
In the latest edition of its Visual Networking Index (VNI) study, Cisco forecasts that HD and Ultra HD video will account for nearly two-thirds of all IP video traffic by 2018.
Seven new cable products take the stage this year, covering a wide range of the technology spectrum.
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Custom TV
Using Service Quality to Drive WiFi Monetization

10|22|14   |   6:51   |   (0) comments


Live from the SCTE conference: Heavy Reading's Alan Breznick explores the forces shaping the WiFi opportunity in an interview with CableLabs' Justin Colwell and Amdocs' Ken Roulier.
LRTV Custom TV
Distributed Access Architectures – 2

10|21|14   |   8:51:00 AM   |   (0) comments


ARRIS CTO Network Solutions Tom Cloonan discusses why many if not most MSOs will continue with integrated CCAP, while addressing why some are also looking at two futuristic, distributed access architectures: Remote PHY and Remote CCAP.
LRTV Custom TV
Distributed Access Architectures – 1

10|21|14   |   9:01   |   (0) comments


SCTE Sr. Director of Engineering Dean Stoneback discusses the pros and cons of distributed access architecture (DAA) and its various forms, which range from basic Remote PHY to full CMTS functionality in the node.
LRTV Custom TV
The WiFi Road to Riches – 2

10|21|14   |   3:58   |   (0) comments


ARRIS Senior Solution Architect Eli Baruch talks about how MSOs can enable public and community WiFi through 1) outdoor access points, 2) businesses seeking to offer WiFi to customers, and 3) residential WiFi gateway extensions.
LRTV Custom TV
The WiFi Road to Riches – 1

10|21|14   |   10:15   |   (0) comments


SCTE Director of Advanced Technologies Steve Harris discusses WiFi deployments, drivers, challenges and advances, including 802.11ac, carrier-grade WiFi, community WiFi, Hotspot 2.0, Passpoint, WiFi-First and voice-over-WiFi.
LRTV Custom TV
Advantech Accelerates 100G Traffic Handling

10|17|14   |   7:56   |   (0) comments


Paul Stevens from Advantech explains why handling 100GbE needs a whole new platform design approach and how Advantech is addressing the needs of equipment providers and carriers to give them the flexibility and performance they will need for SDN and NFV deployment.
LRTV Huawei Video Resource Center
Holland's Imtech Traffic & Infra Discusses Huawei's ICT Solution and Services

10|16|14   |   4:49   |   (0) comments


Dimitry Theebe is from the business unit at Imtech Traffic & Infra which delivers communications solutions for transportations. His partnershp with Huawei began about a years ago. In this video, Theebe speaks more about this partnership and what he hopes to accomplish with Huawei.
LRTV Huawei Video Resource Center
Huawei's Comprehensive Storage Solutions Vital for SVR

10|16|14   |   6:16   |   (0) comments


SVR Information Technology provides cloud services for academic and special sectors. With Huawei's support, SVR and Yildiz Technical University has established Turkey's largest and most advanced High Performance Computing system. CSO Ismail Cem Aslan talks about what he hopes Huawei's OceanStor storage system will bring for him.
LRTV Huawei Video Resource Center
Mexico's Servitron's Impression of Huawei at CCW 2014

10|16|14   |   6:35   |   (0) comments


Servitron is a network operator in Mexico that has been in the trunking industry for the past 20 years. Its COO, Ing. Ragnar Trillo O., explains at Critical Communications World 2014 that his company has been interested in the long-term evolution of LTE technology and its adoption for TETRA.
LRTV Huawei Video Resource Center
Building a Better Dubai

10|16|14   |   2:06   |   (0) comments


Abdulla Ahmed Al Falasi is the director of commercial affairs, a telecommunications coordinator for the government of Dubai. Their areas of service span across multiple industries, including police, safety, shopping malls and more. In this video, Abdulla talks about his department's work with Huawei.
LRTV Huawei Video Resource Center
Huawei Lights Up Malaysia Partner Maju Nusa

10|16|14   |   1:59   |   (0) comments


Malaysia's Maju Nusa is an enterprise partner to Huawei in networking, route switches and telco equipment. At this year's Critical Communications World in Singapore, CTO Pushpender Singh talks about what Huawei's eLTE solutions mean to his company and for Malaysia.
LRTV Custom TV
Evolving From HFC to FTTH Networks

10|15|14   |   2:19   |   (0) comments


Cisco's Todd McCrum delves into the future of cable's HFC plant, examining how DOCSIS 3.1 and advanced video compression will extend its life and how the IP video transition will usher in GPON and EPON over FTTH.
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
February 10, 2015, Atlanta, GA
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Google: Carriers & Cloud Providers Need to Cooperate
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/16/2014
iPad Air 2 Lets Users Switch Carriers Any Time
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/17/2014
Analysts Warn of Major NFV Gaps
Carol Wilson, Editor-at-large, 10/22/2014
CBS Takes OTT Plunge
Mari Silbey, Independent Technology Editor, 10/16/2014
NYC Subway Wireless No Cure for Ebola Fears
Dan Jones, Mobile Editor, 10/16/2014
Like Us on Facebook
Twitter Feed