Disney and Time Warner Shares Power Down on Pricing Threat
Cable providers are currently working on the ability to provide individual, or “a la carte,” channel subscriptions. This alternative subscription method has been spurred on by growing content costs as well as growing subscriber losses.
If cable providers are able to make the transition, it could be devastating to a network owner such as Disney (NYSE:DIS), which reportedly gets $4/month per subscriber for ESPN, whether or not a subscriber cares for it. A la carte subscriptions could also open the door for channel subscriptions to be sold to online video providers such as Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG), Amazon (NASDAQ:AMZN), and Netflix (NASDAQ:NFLX). Disney and Time Warner (NYSE:TWX) are expected to fiercely combat the idea.
Disney stock (NYSE:DIS) is down 2.18% to $30.48 in the news. Shares are down 5.54% in the past 52 weeks. The stock has traded in a 52-week range between $29.05 and $44.34.