Walt Disney Co.'s ESPN sports network said Monday that it has sued Verizon Communications Inc. in New York state court, saying the company violated the terms of their contract by including its programming in a new Custom TV service.
ESPN said it's seeking an injunction and damages. The filing wasn't immediately available from the court.
Custom TV, which Verizon began selling earlier this month, gives viewers a base package of channels for $55 and a choice to add other categories for $10 apiece. That's cheaper than the bigger bundles of cable channels that traditional services typically consider the minimum buy.
As more consumers cut the cable cord or avoid subscribing in the first place, however, pay-TV providers are starting to look to break up the traditional bundles of hundreds of channels. Media companies are meanwhile trying to protect their businesses, saying their distribution agreements specify that certain popular channels must remain in main, larger packages.
Last week Walt Disney Co. pulled TV ads for Custom TV from its networks, which include ESPN, ABC and A&E.
Fox Sports and NBCUniversal have also said the carrier doesn't have the right to offer their networks on Custom TV. Verizon, which started selling the smaller, cheaper pay-TV package this month, has said that it is within its rights under accords with the media companies.
~ Bloomberg News ~