Programmers balk at Verizon's 'Custom TV' plans

There seems to be a disconnect between Verizon's (NYSE: VZ) plans to break apart FiOS video bundles and the way those who provide content for those bundles feel. FiOS, as the company reported in its earnings call earlier this week, is a bright spot in the sagging wireline space and Verizon is hoping to enhance that business by giving customers more choice.

Verizon EVP-CFO Fran Shammo, responding to an analyst's question during the first-quarter 2015 earnings call, said that its proposed FiOS "Custom TV" project "is a product that the consumer wants; it's all about consumer choice."

Programmers feel a bit differently. Disney-owned ESPN, which already questioned the legality of the project, has now been joined by Fox and NBCUniversal in bashing the carrier for trying to break up its channel bundles.

"We reject Verizon's view that it can pursue the new packaging scheme it announced yet still comply with our agreements," a statement issued by 21st Century Fox's sports division said, according to a Bloomberg story.

Fox, like Verizon, added that it preferred "to keep our commercial discussions confidential and will address our concerns directly and privately with Verizon."

Adding fuel to the fire was NBCUniversal. A corporate spokesperson, through e-mail to Bloomberg, said that the Custom TV plan "does not comply with our existing agreement."

The brouhaha is probably more related to carriage fees than legalities. ESPN, for instance, receives $6.61 per subscriber, according to some results. That figure could be challenged if subscribers, given the opportunity, decided to opt out of ESPN as part of a smaller package.

For more:
- see this Bloomberg story
- see this USA Today story
- see this CNBC.com story

Related articles:
Connected TV use to surge as SVOD revenues quadruple to $31.6B by 2019, report says
NBC and Fox join pushback parade on Verizon's 'Custom HD' bundling
Disney/ESPN says it didn't consent to Verizon plan to break up bundles

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