Disney Deal Gives Dish Its Netflix Ambitions

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By Trey Thoelcke Published
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Dish Network Corp. (NASDAQ: DISH) and Walt Disney Co. (NYSE: DIS) reached a long-term deal Monday that allows the second-largest U.S. satellite TV provider to carry Disney-owned networks such as ABC and ESPN. The deal also allows it to deliver that content outside of a traditional TV subscription, streaming via set-top boxes, smartphones, tablets and computers.

This marks the first time a content owner has granted cable or satellite TV operators the digital rights to sell their shows outside of a pay-TV subscription. Dish did not offer any details about what its potential TV subscription over the Internet might look like or cost, or when such a service would launch. There likely will be plenty of demand for it. North American consumers are expected to spend $6 billion this year on entertainment from services such as Netflix Inc. (NASDAQ: NFLX). That would be more than double what they spent in 2010.

The deal also will end pending litigation between the Dish and Disney concerning the former’s AutoHop feature, which allows viewers to automatically skip commercials on programming recorded on its DVRs. AutoHop will be discontinued for ABC programming for three days following the initial broadcast as part of the new deal.

The previous arrangement between Dish and Disney expired at the end of September, but they have been negotiating since then, hoping to avoid a signal blackout like the one between CBS Corp. (NYSE: CBS) and Time Warner Cable Inc. (NYSE: TWC) in August that resulted in substantial subscriber defections.

In order to offer a Netflix-like TV service to people who would rather stream TV over the Internet than place a satellite receiver on their roof, Dish may now seek to reach similar agreements with other big content owners, including CBS, 21st Century Fox Inc. (NASDAQ: FOXA) and Comcast Corp. (NASDAQ: CMCSA), which owns NBC.

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About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.

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