Verizon, ESPN Reach Settlement on Pay-TV Channel Packages

By Shalini Ramachandran 

Verizon Communications Inc. and ESPN said they have reached a settlement in their yearlong legal dispute over how the sports network is distributed.

ESPN, which is majority-owned by Walt Disney Co., filed a lawsuit against Verizon in April 2015 over so-called "Custom TV" packages that the phone giant's FiOS unit had started selling to customers. Those packages allowed people to buy a basic set of channels, including broadcasters and some cable networks, and layer on tiers of channels in genres like sports and kids. At issue was that customers could get a basic package of channels that didn't include ESPN, which the sports network said violated its contract.

In February, Verizon revamped its base packages to include one with sports channels like ESPN and one without. A week later, court proceedings in New York Supreme Court were postponed while the companies tried to negotiate a settlement.

ESPN has been left out of several channel packages over the years, and as more people "cut the cord" or downgrade to cheaper plans, it has experienced subscriber losses that have caught Wall Street's attention.

Write to Shalini Ramachandran at [e-mail]

(END) Dow Jones Newswires

May 10, 2016 12:22 ET (16:22 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.