DirecTV gives grim response to customers upset over Disney outage

Over the weekend, DirecTV experienced (and is still experiencing) a major outage during one of the most vital times of the year for sports fans, disrupting and upsetting millions of customers.

On September 1st, in the middle of the unofficial opening weekend of the college football season and the US Open, DirecTV customers were left outraged after receiving an unpleasant surprise. All Disney (early) networks like ESPN, ABC, Freeform, etc., had disappeared from the cable lineup.

Related: Spectrum Quietly Plans Big Price Change

The issue is due to an ongoing contract dispute between DirecTV and Disney. DirecTV blames Disney for taking an “anti-consumer approach” by “requiring” DirecTV customers to pay extra to access Disney-owned channels.

“Disney is driving consumers away from its network sites and apps to generate much higher subscription revenue for Hulu, Disney+, ESPN+ and future streaming aspirations,” DirecTV said in a Sept. 1 statement.

DirecTV also claims that hours before Disney pulled its programming from the channel lineup, it required DirecTV to drop all claims that Disney’s conduct was anticompetitive in order to reach any licensing agreement.

In response to the allegations, Disney claims that DirecTV “continues to misrepresent the facts” surrounding their contract negotiations.

DirecTV is responding to frustrated customers

Aggrieved DirecTV customers have since taken to social media to threaten to cancel their cable subscriptions with the company over the absence of Disney-owned channels.

This is the week I finally cancel @DIRECTV. I’m tired of missing shows and games.

— TC Mainstreamer (@TrueNorth4ever) September 2, 2024

@DIRECTV I guarantee you are about to lose a LOT of customers! TOMORROW MORNING AT 8:00 AM WHEN BUSINESSES OPEN AGAIN I WILL DISCONNECT mine WHEN POSSIBLE

— jb (@jerlbrown) September 2, 2024

@DIRECTV canceling my service right now and switching to @hulu so crazy you guys do this basically everywhere at the start of football season.

— Lee Pardue (@LeePardue) September 2, 2024

In response to each cancellation threat on X, DirectTV has argued that switching cable providers is not the right solution.

“Switching is not the answer,” DirecTV said in a Twitter response to an angry customer. “The loss of sports, shows and movies affects the entire industry, including streaming services.”

To soften the blow to Disney, DirecTV also announced that it will offer customers a $20 credit, which can take up to two billing cycles to apply.

DirecTV is already dealing with declining cable customers

DirecTV’s response comes at a time when the company, which is owned by AT&T (T) is losing a large amount of subscribers amid the widespread cord-cutting trend, where consumers ditch cable for streaming. According to an analyst at Leichtman Research Group, DirectTV will lose 1.8 million cable customers in 2023.

A DirecTV Group Inc. truck. sits parked at a customer during a satellite installation in Bixby, Oklahoma, U.S., Monday, June 27, 2011.

Bloomberg/Getty Images

The group also estimates that the U.S. cable industry as a whole lost more than 6.9 million customers last year.

During a July 24 earnings call, AT&T CFO Pascal Desroches said DirecTV faced declining revenue in the second quarter of 2024.

“DirecTV’s distributions this quarter were approximately $740 million, and we continue to expect DirecTV’s cash distributions to decline at a rate similar to 2023, or approximately 20% annually,” Desroches said during the call.

Related: Veteran fund manager sees world of pain coming for stocks