Disney and Dish Ink Long-Term Deal, Giving Satcaster Internet-Streaming Rights to Live TV

Under deal, Dish has agreed to disable ad-skipping in Hopper DVR for ABC programming

Dish Network and The Walt Disney Co. announced that they have struck a long-term programming deal that gives the satcaster expansive new rights to Mouse House TV programming — and could pave the way for Dish to become the industry’s virtual pay-TV provider.

But as part of the deal, Dish has agreed to disable the ad-skipping function in its Hopper digital video recorder for three days for ABC programming.

That was a concession Dish execs were willing to offer, in return for an unusually broad basket of content and distribution rights. Among other elements of the pact, Disney has granted Dish over-the-top rights — letting the satcaster include Disney programming in a virtual pay-TV service. Dish has the ability to stream cleared linear and video-on-demand content from ABC-owned broadcast stations, ABC Family, Disney Channel, ESPN and ESPN2 as part of an Internet-delivered multichannel offering.

Dish and Disney have been in talks for months on an agreement that would cover carriage of cable networks including ESPN, Disney Channel and ABC Family, as well as ABC-owned stations in eight markets. The previous agreement, reached in 2005, expired Sept. 30, 2013.

SEE ALSO: Dish Seeking Disney Ad Deal for Hopper, Ergen Says

One of the big sticking points in the talks were features of the Dish’s Hopper, which automatically records primetime programming and lets users strip out the commercial breaks. ABC — and CBS, Fox and NBC — have sued Dish over the AutoHop ad-skipping feature.

Under the satcaster’s pact with Disney, Dish will modify the Hopper so users will not be able to skip ads in ABC shows until three days after the shows air. That will let the Alphabet net receive Nielsen C3 ratings credit for Dish subs. Under the deal, ABC will agree to drop its litigation over the Hopper, according to the companies.

Disney and Dish’s deal also covers other advertising models, including dynamic ad insertion, advertising on mobile devices and “extended advertising measurement periods,” the companies said.

“The creation of this agreement has really been about predicting the future of television with a visionary and forward-leaning partner,” Dish president and CEO Joe Clayton said in a statement. “Not only will the exceptional Disney, ABC, ESPN entertainment portfolio continue to delight our customers today, but we also have a model from which to deliver exciting new services tomorrow.”

Anne Sweeney, co-chairman of Disney Media Networks and president of Disney/ABC Television Group, said the agreement will “position our industry for future growth…. Not only were innovative business solutions reached on complicated current issues, we also planned for the evolution of our industry.”

Also under the Dish-Disney pact, Dish will add the Mouse House’s TV Everywhere services — WatchESPN, Watch Disney, Watch ABC Family and Watch ABC — that lets subscribers watch video on Internet devices in and outside the home. Plus, Dish subs with ESPN and ESPN Deportes in their lineups will have access to the live and video-on-demand channel ESPN3.

In addition, Dish has agreed to carry Fusion — the news-and-lifestyle cable network joint venture of Univision and ABC News — Disney Junior, ESPN Goal Line, ESPN Buzzer Beater, Longhorn Network and the upcoming SEC ESPN Network, expected to launch in August 2014.

As part of the agreement, Dish will launch ESPNews, ESPNU, Disney Channel and ABC Family in HD, while ESPN Classic will be reintroduced as a VOD channel.

VOD content also figures into the pact, with Dish acquiring rights to a range of video-on-demand content accessible on computers at home and outside the home through the Dish Anywhere app for tablets and smartphones. That includes ABC primetime entertainment programming, including “Scandal,” Castle,” “Grey’s Anatomy,” “Once Upon A Time” and “Revenge,” plus episodes of shows from ABC Family, Disney Channel On Demand, Disney Junior On Demand, and Disney XD On Demand. Additional ESPN VOD content includes programming from ESPN Deportes and ESPN Films.

Finally, the companies also renewed carriage agreement for ABC’s eight owned local stations: WABC-TV in New York City, KABC-TV in Los Angeles, WLS-TV in Chicago, WPVI-TV in Philadelphia, KGO-TV in San Francisco, WTVD-TV in Raleigh-Durham, KTRK-TV in Houston, and KFSN in Fresno, Calif.