More than a week after announcing a new deal that will bring Disney-owned network back to its platform, sports-centric streaming TV service Fubo TV says it will drop nearly a dozen other networks owned by AT&T’s WarnerMedia division.
Just after midnight on Wednesday, Fubo TV users will lose access to CNN, TBS, TNT, Cartoon Network, Boomerang, Tru TV, Turner Classic Movies, CNN International and CNN en Español.
Based on Fubo TV’s announcement, the channels are unlikely to return anytime soon, if at all.
“We are disappointed that our deal with Fubo TV is not being renewed, as we have been working with them and were open to a potential renewal,” an AT&T executive said in a statement provided to The Desk Tuesday evening.
News of Fubo TV’s decision to drop AT&T’s WarnerMedia channels was first reported Tuesday evening by the trade publication Deadline Hollywood.
The expiration of the deal closes a two-year chapter in which WarnerMedia’s Turner portfolio of channels were offered through the streaming service. Fubo TV never made WarnerMedia’s premium movie networks HBO or Cinemax available as a separate subscription to users, choosing to emphasize ViacomCBS’s Showtime instead.
Fubo TV’s main offering is sports, with dozens of channels dedicated to that genre of programming. WarnerMedia’s portfolio of networks were attractive to Fubo TV thanks to certain college basketball, professional basketball and professional baseball rights held by TBS and TNT.
But those rights weren’t enough to keep Fubo TV interested in the channels — and another deal with a rival programmer may have ultimately tipped the scales in favor of dropping them.
In late June, Fubo TV announced it had reach an agreement with Disney to distribute ESPN, the Disney Channel and Freeform to users. The agreement also includes a handful of cable networks previously owned by 21st Century Fox, including FX and FXX, as well as the streaming news network ABC News Live and local ABC channels in eight markets where Disney owns the station.
ESPN, which Disney jointly owns with Hearst Television, is considered one of the most-expensive pay TV networks for distributors to offer customers, commanding nearly $8 per subscriber, according to an estimate by the analytics firm SNL Kagan.
As a condition of carriage, Disney often requires cable and satellite companies to offer ESPN in their basic tier of service, according to industry experts familiar with these negotiations. In recent years, Disney has started to require that same term and others to Internet-based streaming services like YouTube TV, Sling TV and AT&T TV, experts say.
Some companies have gotten around this condition by offering customers “economy” packages that aren’t advertised and don’t include the word “basic” by name or description. Comcast, for example, doesn’t advertise its “digital economy” package to the public but will offer it if a customer asks for it by name. That package, which is cheaper than the company’s advertised “digital starter” tier, does not include ESPN.
It is a bit harder for streaming companies to hide budget packages from their users: Most disclose what channels users will get and what price right on the front of their website — something they say bolsters their transparency when compared to “hidden fees” and other sneaky tactics used by traditional cable and satellite companies, but also one that makes it difficult to offer skinnier packages that don’t include high-cost sports networks.
As media companies buy out competitors and consolidate into even-larger corporations, some companies like YouTube TV have agreed to add new channels into the fold while raising prices on customers. On Tuesday, the Google-owned streaming service announced it would add eight ViacomCBS channels and hike the price of their one-size-fits-all package to $65 a month.
The price hike appeared to stem from a new agreement between Google and ViacomCBS to continue offering the CBS portfolio of channels, including CBS local stations, some CW stations, CBS Sports Network, Smithsonian Network and Showtime. Rather than lose the CBS stations, Google agreed to new terms that included Viacom’s MTV Networks, which had been conspicuously absent from the service since it launched three years ago.
Other programmers, including the $20-a-month service Philo and Disney’s more-expensive Hulu with Live TV, will likely have to wrestle with the same conundrum as pre-merger contracts with CBS and Viacom start to expire. With virtually no leverage on their side, those services will likely have to choose between maintaining their current prices and dropping channels, or adding channels and raising subscription fees.
Fresh on the heels of its new agreement with Disney and with its WarnerMedia contract expiring, the choice was a bit easier for Fubo TV: Bring one group of channels into the mix and drop other, less-sports oriented networks. Whether or not users can go without their CNN, TBS and Cartoon Network remains to be seen.
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