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⚠ Carriage Fights Cost Real MoneyModerate threat

Walt Disney (DIS) — threat to the moat

A YouTube TV blackout cost Disney about $110 million in Q1 FY2026, another dispute hit Q3, and DISH has filed antitrust counterclaims.

Affiliate fee increases are now negotiated in public. In the first quarter of fiscal 2026 the "Temporary suspension of YouTube TV carriage had an adverse impact to segment operating income of approximately $110 million"1. In the third quarter Sports results suffered from "the impact of a network carriage dispute" as well as early-round NBA sweeps2.

Disney carriage disputes in fiscal 2026Q1: YouTube TV suspensionabout $110M of segment operating incomeQ3: network carriage disputecontributed to Sports operating income -17%2 January 2026: DISHantitrust counterclaims, including tyingWalt Disney Q1 and Q3 FY2026 earnings releases; Form 10-Q Q3 FY2026
Two blackouts and a countersuit in one year.

The disputes are becoming legal ones too. In Disney's breach-of-contract suit against DISH, DISH filed antitrust counterclaims on 2 January 2026, including a tying claim3, which challenges the practice of requiring distributors to carry several Disney channels together.

Every blackout tests the moat in real time. If viewers do not cancel the distributor, the distributor learns it can live without Disney for a while. If they do, Disney wins the rate. The YouTube TV dispute is covered further on the Competitors page about YouTube.

Blackouts hurt partly because the audience is still large. The 2026 NBA and NHL playoffs finished "as the most-viewed ever on our networks"4. A distributor that drops ESPN during a record postseason is betting its customers will not notice, and most distributors lose that bet.

The measure is what blackouts cost. Blackout costs above $250 million of segment operating income in a fiscal year would mark distributors using blackouts as a regular bargaining tool, and rate increases costing more to win.

References
  1. ReportedIn the first quarter of fiscal 2026 the "Temporary suspension of YouTube TV carriage had an adverse impact to segment operating income of approximately $110 million".
    The Walt Disney Company first-quarter fiscal 2026 earnings release, Form 8-K exhibit 99.1 - segment results for the quarter to 27 December 2025 and the approximately $110 million effect of the temporary suspension of YouTube TV carriage. — Q1 FY2026 · publ. February 2026 · source ↗
  2. ReportedIn the third quarter Sports results suffered from "the impact of a network carriage dispute" as well as early-round NBA sweeps.
    The Walt Disney Company third-quarter fiscal 2026 earnings release, Form 8-K exhibit 99.1 - Sports results, ESPN viewership, the NFL Transaction and programming costs. — Q3 FY2026 · publ. 5 August 2026 · source ↗
  3. ReportedIn Disney's breach-of-contract suit against DISH, DISH filed antitrust counterclaims on 2 January 2026, including a tying claim, which challenges the practice of requiring distributors to carry several Disney channels together.
    The Walt Disney Company Form 10-Q for the quarter ended 27 June 2026 - the NFL Transaction and its $3 billion fair value, the Fubo Transaction, litigation including the Disney+ securities class action and the DISH counterclaims, and shares outstanding at 29 July 2026. — Q3 FY2026 · publ. 5 August 2026 · source ↗
  4. ReportedThe 2026 NBA and NHL playoffs finished "as the most-viewed ever on our networks".
    The Walt Disney Company third-quarter fiscal 2026 earnings release, Form 8-K exhibit 99.1 - Sports results, ESPN viewership, the NFL Transaction and programming costs. — Q3 FY2026 · publ. 5 August 2026 · source ↗
Sources
Generated October 5, 2026