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Dish-Disney deal envisions Internet-delivered TV

A Dish Network and Disney agreement opens the way for the satellite TV service to live-stream Disney-owned channels like ESPN and ABC over the Internet to customers’ smartphones, tablets, video game consoles and other devices.
Published: March 5, 2014

The deal is the first of its kind between a major pay TV distributor and a top media company. But the pair won’t be alone.

In January, Verizon Communications Inc. bought Intel Corp.’s media group with an eye toward an Internet-delivered TV service over mobile devices. Sony Corp. also said it would launch an Internet-based U.S. TV service this year.

“It’s hard not to see this as the beginning of the virtual (multichannel video service) that we’ve been waiting probably two years for,” said Rich Greenfield, an analyst with BTIG Research. He said that while 100-plus channel high-definition deals will still appeal to most TV consumers, an online-only TV service with mobile capability and lower price will appeal to others.

“I think it’s realizing that it isn’t a one-size-fits-all market for multichannel video,” he said.

Dave Shull, Dish’s chief commercial officer, said Dish’s offering will target people ages 18 to 34 who live in apartments, don’t have multiple TV sets and don’t need a traditional committment.

For Dish, that commitment usually means a two-year contract. Long-term contracts allow the company to make a profit while covering launching and maintaining satellites and installing dishes.

By delivering video over the Internet, Dish would probably contain costs.

The deal’s financial terms were not disclosed.

Dish CEO Joseph Clayton said in a statement the deal was “about predicting the future of television.”