Television ads for Verizon’s new pay-TV package service, FiOS Custom TV, have been pulled from channels owned by Walt Disney Co. in Burbank.
Verizon Communications Inc. started selling the cheaper and smaller Custom TV channel bundle package this month, saying it gives customers more choice.
But Verizon was notified by e-mail Wednesday that Disney will not run ads for FiOS Custom TV on their channels, which include ABC, ESPN and A&E, as they say the offering violates contract agreements.
New York’s Verizon has argued that it is within its rights under current agreements with media companies to offer the slimmer service, which gives subscribers a basic package of 36 fixed channels for $55 with the option of paying to add other bunches of niche targeted channels, such as sports, news and kids shows.
The backdrop to the dispute is that as pay-TV providers look to break up the large bundles of channels currently offered by cable rivals and online firms, media companies are trying to protect their business by keeping certain popular channels within larger packages.
Representatives for Disney and Verizon did not immediately respond to requests for comment.