ESPN, other channels go dark on Spectrum over contract dispute with Disney
WORCESTER – Cable TV viewers may have been surprised recently when some of their favorite channels, including ESPN, went dark on Spectrum, Worcester’s cable provider.
A contract dispute between Spectrum and The Walt Disney Company means content on Disney-owned ABC, including ESPN, is off the cable provider’s system nationwide. This occurs as Worcester is negotiating a new 10-year license agreement with Spectrum to provide cable television services within the city.
The current contract ends in October.
Meanwhile, City Manager Eric Batista and Mayor Joseph Petty recently sent a letter to Spectrum that expressed concern about company price hikes that included a $1 per month broadcast TV surcharge and a $5 monthly internet fee.
Spectrum did not respond to a request for the specific amounts of the price increases, but said customers were notified of them in July and they took effect last month. Any Spectrum internet customer with an automatic payment plan receives a $5 monthly discount, said a Spectrum spokeswoman.
More: ESPN goes dark for Spectrum cable subscribers amid Disney-Charter Communications dispute
'Spectrum cares not to provide anything'
Spectrum said the recent price increase isn't a factor in license negotiations with the city.
"Programming costs and pricing are consistent throughout the markets we serve. They are not part of renewal process," said a Spectrum spokeswoman.
But one member of the city's Cable Television Advisory Committee doesn't see it that way.
Stephen Quist, a committee member for the past five years, said it's possible the committee — its members appointed by the city manager and confirmed by the City Council — could vote to recommend that Worcester not renew the contract.
Frustration is mounting, said Quist, because Spectrum doesn't respond to committee inquiries that run from customer complaints to requests for information.
"Spectrum cares not to provide anything," said Quist.
John Keough sits on the Cable Television Advisory Committee and said he's not surprised about the Spectrum-Disney dispute: "Spectrum negotiates in negative tactics and gives its customers the least amount possible."
Keough also criticized Disney, noted he works in the film industry, and said some of his prior projects had ties to Disney.
"Disney is cheap, and they don't like to pay," said Keough.
Worcester sends $462M to Spectrum
Spectrum's license agreement with Worcester is the company's most lucrative in New England and its 10th-most profitable in the U.S., said Quist. Worcester's 27,000 Spectrum subscribers pay Spectrum a total of $462 million over the life of the current 10-year deal, according to Quist.
What Worcester gets, said Quist, is $20 million back from Spectrum over those 10 years that pays for the city's three PEG (public, education, government) television channels: public access, education channel for the city's schools and Worcester's government channel.
The reported letter from Batista and Petty irks Quist, because he said Spectrum violated its contract with Worcester by hiking prices several times in the past 18 months, when only one increase is allowed annually.
Extension of current license a possibility
Quist expects the city and Spectrum will mutually agree to extend the current license, because the details won't be ironed out by October. It could take a year to reach a new deal, said Quist.
Meanwhile, the Cable Television Advisory Committee is working on a report that will include its recommendation on whether to move ahead with renewal of the license. Quist thinks the report will done by October or November.
Given Spectrum's price increases and the committee's frustrations with the company, Quist said he will likely vote against license renewal. He noted that a survey showed roughly 80% of Worcester residents are not satisfied with Spectrum's customer service.
"Spectrum doesn't care," said Quist. "They have shown when complaints come up, they slough them off. Spectrum is not a team player and a partner with the city."
Details of Spectrum-Disney dispute
In a press release, Spectrum listed several reasons for its dispute with Disney, including Disney’s insistence on “unsustainable price hikes"; forcing customers to take their products, even when they don’t want or can’t afford them; and requiring customers to pay twice to get content mobile applications with linear video that they have already paid for.
“We respect the quality video products that The Walt Disney Company produces as well as the experience of its management team,” said Spectrum in a prepared statement. “But the current video ecosystem is broken, and we know there is a better path that will deliver video products with the choice consumers want.”
The broken system, according to Spectrum, didn't happen overnight. For the past 10 years, traditional forms of TV from satellite or cable lost 25 million customers, representing nearly 25% of the total industry. It was largely fueled by the migration to streaming services, according to Spectrum, along with the "vicious" cycle of programming cost increases and subscriber losses.
Disney proposed a long-term deal that ignored the changing marketplace, said Spectrum, while Spectrum offered a deal that included flexible content packages and pricing. That shorter-term deal would have paid Disney $2.2 billion in 2023, but Spectrum said Disney decided not to accept a contract extension.
Keough has industry sources that told him Disney's streaming customer base has fallen significantly. The industry is moving away from content providers that pay carriers like Spectrum to deliver their content. That's costly, so the growing trend is to offer programming from one source instead of paying other platforms to deliver entertainment.
"Companies are moving into one place to reach the consumer directly, without sending over the (cable) wires," said Keough.
Contact Henry Schwan at henry.schwan@telegram.com. Follow him on X: @henrytelegram.
This article originally appeared on Telegram & Gazette: ESPN goes dark on Spectrum in Worcester over dispute with Disney
