Verizon has faced off with network giants Fox, Disney, and NBC as a result of the uproar at Verizon’s plans for their new ‘sports-free’ TV bundles; citing the violation of programming contracts. The offer is considerably unpopular with ESPN and Fox Sports, as is to be expected, with Fox stating ‘We reject Verizon’s view that it can pursue the new packaging scheme it announced yet still comply with our agreements’.
The cause of all of this dramatic posturing...
is Verizon’s unveiling of its ‘Custom TV basic bundle’. The package offers consumers a total of 34 base channels with a choice of 2 bundles for their subscription. Bundles on offer include:
Sports- with ESPN & Fox Sports included
Entertainment- with Syfy, TNT & FX
Lifestyle- with Bravo and TLC
As well as several other offers
This means that consumers can choose to purchase a subscription without any sports channels included, making it hugely unpopular with sporting networks who see a large share of their revenue from programmatic advertising.
Tami Erwin, Verizon FiOS president, has already stated that the product had been designed specifically so that it would not violate contracts. Whilst the contents of the disputed programming contracts are not publicly disclosed, we can be sure that many other networks and pay TV operators will join in with criticism aimed towards Verizon.
Networks seek solutions
Verizon is attempting to draw consumers to its $54.99 service with an offer that considerably undercuts traditional network packages (regularly priced at over $80 per month). This latest venture is understandable when we consider that Verizon is one of many Pay-TV incumbents who have seen loss of customers through ‘cord cutting’ to Over-the-Top (OTT) services.
OTT providers offer much cheaper deals and choice, with Juniper Research’s latest assessment of, Mobile and Online TV & Video, forecasting significant gains for OTT and VOD services, as well as including an in-depth study of potential strategies for Pay-TV providers.
Source: Tech Vocal