Charter CFO Hails Disney Renewal as Triumph for Pay-TV Industry

Charter Communications Inc's CHTR CFO, Jessica Fischer, celebrates the recent contract renewal with Walt Disney Co DIS as a victory for pay-TV providers, marking a significant development in their collaboration.

 This agreement, announced on September 11, includes Charter offering Disney+ and ESPN+ streaming services to its subscribers at no extra cost. 

Charter will pay Disney a wholesale rate for Disney+ and receive ESPN+ as part of the deal. Additionally, Charter will discontinue specific Disney channels, including Freeform and Disney Junior, which it had opted not to pay for, Bloomberg reports.

Disney and Charter were part of a bitter battle over carriage fees, with Charter alleging Disney is demanding higher prices for its channels without waiving charges for its streaming services to Charter customers. Meanwhile, Disney maintained offering Charter the most favorable terms. The dispute since August has deprived millions of customers of Disney TV channels, including ESPN, FX, and Disney Channel.

As part of the arrangement, Disney secures higher fees for its channels, such as ABC and FX, and Charter commits to providing ESPN to a minimum of 85% of its customers. 

Speaking at an investor conference in New York, Jessica Fischer emphasized the collaborative effort, stating that the two companies have crafted a package that can potentially stabilize the pay-TV industry.

The move aims to provide consumers with more flexible TV packages that cater to their preferences and budgets, as Fischer highlighted. 

With the ongoing competition from streaming services like Netflix, Inc NFLX, cable and satellite TV providers face the challenge of retaining their customer base. 

Charter believes that offering a combination of streaming and traditional channels is essential in addressing this evolving landscape.

Fischer stressed the significance of ESPN in this transformational model, noting that it played a pivotal role. 

Charter was willing to accept market-rate increases from Disney, recognizing the value of ESPN as a linchpin asset that would facilitate their transition into this new model.

Price Actions: DIS shares closed lower by 0.24% at $83.48 on Wednesday. CHTR closed higher by 0.64% at $439.40.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.