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Disney warns Altice NY customers they may lose ESPN, ABC

[LOS ANGELES] Walt Disney is warning New York-area customers of Altice USA cable systems that they will lose ESPN, ABC and the Disney Channel if the companies fail to reach a new programming agreement.

The world's largest entertainment company plans to air warnings and run messages across viewers' screens in the affected markets. Altice, which took over pay-TV systems owned by Cablevision Systems, has about 2.4 million subscribers in the area.

"Our contract with Altice is due to expire soon, so we have a responsibility to make our viewers aware of the potential loss of our programming," Burbank, California-based Disney said in an email.

"We remain fully committed to reaching a deal and are hopeful we can do so."

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Disney and Altice are in a high stakes face-off over how much the cable system owner will pay for some of the most-watched programming on TV, including ESPN's Monday Night Football games and comedies like ABC's "Modern Family".

The value of that programming has been called into question by the rise of online services that have drawn viewers away from conventional TV.

Disney is pressing for rate increases, carriage of two collegiate sports networks and terms that ensure its flagship ESPN network is widely distributed.

Altice in a statement said Disney is looking to double the subscriber fees it gets for ABC, impose "exorbitant" increases for ESPN and force customers who don't want the sports channel to pay for it even though viewership has been declining "in the double digits for years.

"This behaviour by ESPN is anti-consumer, and we urge ESPN and its owner to stop the threats, and instead focus on negotiating an agreement that is fair," Altice said.

The negotiations are crucial for Disney. Profit at its largest division, media networks, fell 11 per cent through nine months of the fiscal year due to higher fees for sports rights and shrinking cable subscriptions.

Talks with Bethpage, New York-based Altice mark the first of a new round of contract renewals over the next two years that will involve more than half of Disney's pay-TV customers.

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