DirecTV offers customers $20 refund for lost ESPN, ABC, Disney channels

By Christopher Palmeri | Bloomberg

DirecTV is offering its customers refunds of $20 for the loss of broadcasts from ESPN, ABC and other channels owned by Walt Disney Co., underscoring how much money is at stake as the two companies negotiate a new contract.

DirecTV pays Disney about $2 billion annually for its channels, the company’s chief financial officer, Ray Carpenter, said on a conference call with analysts on Tuesday.

The pay-TV provider’s subscribers lost access to those channels on Sept. 1 when an existing distribution agreement with Disney expired and the signals were blacked out. DirecTV, which is owned by AT&T and TPG, has about 11 million customers, making it one of the largest pay-TV providers in the US.

The loss of ABC and ESPN means DirecTV customers won’t be able to watch the debut of Monday Night Football next week or the US Open tennis matches that conclude with the finals on Sept. 7 and Sept. 8.

Both pay-TV distributors like DirecTV and media companies like Disney are struggling to adapt to changing viewer habits as more consumers drop traditional cable and satellite-TV packages in favor of streaming. DirecTV is seeking to offer smaller packages of channels geared to sports fans and families with kids, and not force customers to buy programming they don’t watch.

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