Verizon has officially launched its FiOS custom TV platform amid backlash from Disney-owned ESPN. The Custom TV platform, a mix-and-match subscription plan that is the first of its kind for cable TV providers, combines 35 basic channels, with genre-focused channel packages. ESPN is Notably missing from the core package, offered instead in the available Sports and Sports Plus package add-ons.
While ESPN argues that licensing contracts with Verizon state that neither ESPN nor ESPN2 may be distributed in a separate sports package (via Recode), Verizon dismissed that claim. “We believe that we are allowed to offer these packages under our existing contracts,” said Verizon CFO Fran Shammo in the media company’s earning’s call today.
Verizon is offering the Custom TV plan at $54.99 per month, which will include two channel packs to choose from (each containing 10 to 17 channels), amounting to about 65 TV channels. The seven different available genre packs are Kids, Pop Culture, Lifestyle, Entertainment, and News & Info, as well as the aforementioned Sports and Sports Plus packages.
“This is a product that the consumer wants… it’s all about consumer choice,” said Shammo. To back up this claim, he noted a Nielsen statistic that says viewers watch an average of just 17 channels.
Although Verizon FiOS’ Custom TV option is now live, we imagine that ESPN and Verizon’s contractual arguments are not yet over. Regardless, this new option definitely hints at further cable TV unbundling, and analysts agree, according to a New York Times report. “If Verizon has this ability, it implies that you will shortly see others do it too,” said Rich Greenfield, a media analyst at BTIG Research.
With an ever-increasing choice of Web TV offerings from the likes of Playstation Vue, Sling TV, and multiple on-demand streaming platforms like Netflix and Amazon Instant Video, the ability to “unbundle” is something that could give Verizon’s new service an edge in the traditional TV genre. First, though, Verizon FiOS Custom TV has to prove itself.
Update by Chris Leo Palermino on 4/21: This piece was updated to reveal that Verizon continued to launch its new Fios service despite backlash from ESPN, as well as adding information about the bundle packages available.