In a sweeping deal between media giants, Comcast will buy Walt Disney’s 40% chunk of E! and Style Network for $1.23 billion — and also pony up $1 billion a year to carry the Mouse’s cable nets and ABC stations.
Agreement, announced Tuesday, also calls for Disney cable fare and ABC primetime TV shows to join Comcast’s ever-expanding video-on-demand lineup.
Pact continues the flow of theatrical movies from Walt Disney Pictures, Touchstone and Miramax to Comcast’s pay-per-view window, with new releases costing $3.99 apiece and library titles $2.99.
“This is one of the broadest distribution deals in the history of our company,” Disney CEO Robert Iger said in a statement.
Comcast — the nation’s largest cable operator, with more than 24 million subscribers — will carry the Mouse’s cable nets, including Disney Channel, ESPN and ABC Family, as well as its seven ABC broadcast stations. It also will cement its position as a key player in the cable network business, gaining full ownership of E! and Style.
Comcast chairman-CEO Brian Roberts stressed what he called “the watershed event” that will give Comcast’s digital subs, for the first time, the free VOD rights to such ABC hit series as “Desperate Housewives” and “Lost” the day after episodes run on ABC’s primetime schedule. The episodes still will have commercials, but Comcast subscribers will be able to fast-forward through them.
The partners declined to disclose the duration of the contract, saying only it will “extend into the next decade.”
For now, the VOD cablecasts of ABC series will be available only to Comcast subscribers in markets where ABC owns a TV station, such as New York, Chicago and San Francisco. (Comcast has no cable systems in Los Angeles.)
But a Comcast spokeswoman said that if the deal follows the pattern of a similar VOD arrangement with CBS and its stations that kicked off last year, the VOD programming will end up in the non-ABC-owned markets as well.
In addition to “Housewives,” “Lost” and “two new yet-to-be-determined primetime series,” ABC will give Comcast’s free VOD service “World News With Charles Gibson,” “Nightline” and “This Week With George Stephanopoulos.”
In addition, a number of series from Disney Channel, Soap Net, Toon Disney and ESPN will flow to on-demand windows set up by these networks.
Roberts said the contract gives Comcast “access to the most Disney content available.”
Spearheaded by Roberts, Comcast tried to buy Disney in 2004 on the theory that its content would shore up the gigantic distribution system the company has built up over the years.
But the takeover of E! Entertainment TV and Style from Disney is a sign that Comcast wants to own more cable nets. It already owns the Golf Channel, Versus (formerly Outdoor Life Network), G4, AZN TV and PBS Kids Sprout.
Comcast has long been the majority stake holder and managing partner in E! Networks, the channels overseen by prexy-CEO Ted Harbert. Move is not expected to shake things up in his group.
In addition, Comcast owns four regional sports nets and has the majority stake in Comcast Spectacor, which includes the Philadelphia Flyers pro hockey team, the Philadelphia 76ers pro basketball team and two arenas in Philly.
Comcast’s high-speed Internet service also will draw on Disney’s promotional content.