Audio Video News

The animosity is heating up between the Walt Disney Company and direct satellite broadcaster EchoStar. Following EchoStar's removal of Disney's ESPN Classic from its offerings, the DBSer is now trying to drop the ABC Family channel, another Disney operation.

The developments are part of a growing struggle between the two companies. Disney has recently gone on record opposing EchoStar's acquisition of DirecTV, a merger that would create a satellite service big enough to rival major cable providers. Blaming falling ratings, cost increases, and Disney's hardball political tactics, EchoStar refused to renew its contract to carry ESPN Classic; the contract ended on New Year's Eve at midnight. On Tuesday, January 1, EchoStar issued a statement attacking Disney for "rate increases well beyond the rate of inflation." Disney's Washington lobbyists are hard at work trying to block the DBS merger on the grounds that it would be anti-competitive and monopolistic. Disney opposed last year's AOL/Time Warner merger for the same reasons, and is also working against the Comcast/AT&T merger.

Claiming that it is trying to protect its subscribers from further fee increases, Littleton, CO–based EchoStar has made a move to stop transmitting other Disney fare—in particular, the ABC Family channel, which it hoped to delete with the start of the new year. On Monday, December 31, Disney obtained a temporary restraining order preventing EchoStar from doing so. ABC Family programming came under Disney's control when the company acquired Fox Family Worldwide, Inc. EchoStar claims that a "change in control" provision in its previous agreement with Fox allows it to dump the channel.

Satellite services and cable providers have long complained about the rates Disney charges for its programming, but have little choice other than to carry it. Disney's ESPN offers National Hockey League and National Football League games, and may soon have an agreement with the National Basketball Association. ESPN is one of the biggest draws on television. Without it, many subscribers would cancel.