10:11am PT by Eriq Gardner
ESPN Claims Verizon Is Breaching Carriage Contract
ESPN is taking Verizon Communications to court with allegations that FiOS "Custom TV" runs afoul of existing carriage contracts.
Since Verizon made the announcement last week that it would become the first pay TV provider to let customers put together a personalized package of TV programming — including options without sports — broadcasters, including Disney's ESPN and 21st Century Fox, have voiced displeasure. Reportedly, the two have refused to air ads for Verizon's new service in some markets.
On Monday, ESPN announced that it was upping the ante in the dispute with a summons in New York court with a more detailed lawsuit to come should the parties not come to an agreement soon.
“ESPN is at the forefront of embracing innovative ways to deliver high-quality content and value to consumers on multiple platforms, but that must be done in compliance with our agreements,” the programmer said in a statement. “We simply ask that Verizon abide by the terms of our contracts.”
ESPN is arguing that the contracts don't allow Verizon to put its sports networks on separately priced tiers.
On a conference call last week, Verizon CFO Fran Shammo said, "“We believe we are allowed to offer these packages under our existing [programming] contracts.”