Disney’s TV channels, including ESPN and ABC, could be cut off for DirecTV subscribers as early as this Sunday if the two sides can’t agree on a new distribution deal. And right now, the two companies appear to be far apart in negotiations.

DirecTV’s contract with Disney expires on Sunday, September 1. If there is no agreement or temporary extension by then, Disney’s channels could be pulled from DirecTV. The extension talks come as the NFL season begins next month and ESPN’s “Monday Night Football” returns on September 9.

Justin Connolly, President of Disney Platform Distribution, said in an interview with diversity“We continue to put a number of concrete options on the table, and DirecTV has not yet taken a serious approach to them.”

“Right now we’re far apart,” Connolly said. “The focus is on working out the details and the ball is in their court.”

DirecTV has said it wants more “flexibility” in bundling the Disney networks — and Connolly said Disney has floated several proposals, including a sports-focused package that includes ESPN and ABC, as well as the option to bundle Disney+ and Hulu with DirecTV’s TV packages. “We’ve tried to be flexible on various constructs that DirecTV might look for,” he said, including using Disney’s September 2023 deal with Charter Communications as a template. “We’ve floated several proposals in the room to try to get this done.”

Disney’s last major lineup renewal came with Charter, after Disney’s networks on Charter systems were down for 12 days. Under that deal, select Spectrum TV customers can enjoy Disney+ and ESPN+ at no additional cost. Spectrum continued to carry Disney-owned ABC television networks, Disney Channel, FX, Nat Geo, and the entire ESPN network lineup. However, the cable operator has removed the following channels from its lineup: Baby TV, Disney Junior, Disney XD, Freeform, FXM, FXX, Nat Geo Wild, and Nat Geo Mundo.

Regarding the Disney-Charter deal, Rob Thun, chief content officer at DirecTV, pointed out that Charter pays all eligible Spectrum TV subscribers for the ability to add Disney+ and ESPN+, but analysts have estimated that less than 10% of them have activated Disney+ and less than 4% have used ESPN+. DirecTV would like a deal where it only pays for subscribers who use the streaming options.

Of the talks with DirecTV, Connolly said, “Right now, we’re focused on figuring out if we can work something out in the next four days… What keeps coming up is this suggestion of ‘we want something different,’ ‘genre-based options,’ without any specifics.” According to Connolly, any claim that Disney hasn’t been “innovative or constructive” is “just patently false.”

Negotiations between the two companies will take place in person at DirecTV’s headquarters in El Segundo, California.

A DirecTV spokesperson declined to comment, but pointed to a blog post by Thun outlining the company’s positions. In a post last week titled “Looking to a Better TV Future,” Thun wrote that “programmers must work with pay-TV providers to deliver entertainment options that meet consumer preferences.”

Thun outlined three points to achieve this goal: “flexible packages” so that consumers “can choose from genre-based programs without having to compile and purchase a large selection of channels that do not meet their preferences”; cheaper alternatives priced more in line with direct-to-consumer streaming services; and an “aggregated experience” that combines linear and on-demand programs.

“At DirecTV, we can transition smoothly to a model that gives consumers more choice, control and value to complement programmers’ DTC offerings,” Thun wrote. “Distributors like DirecTV have been asking programmers for years for the flexibility to launch leaner packages. It’s high time we worked together to capitalize on this sea of ​​opportunity.”

Like other pay-TV providers, DirecTV’s subscriber base has shrunk dramatically in recent years. Leichtman Research Group estimates that the satellite TV and streaming service operator had 11.3 million subscribers (including AT&T U-verse TV) by the end of 2023 – down from a peak of 25.5 million at the end of 2016. DirecTV is majority-owned by AT&T, with a minority stake held by TPG.

Disney’s Connolly claimed in the talks with DirecTV: “We are in line with other providers in the market on pricing and economics. That certainly reflects our content. Our goal is to resolve this in a way that benefits both The Walt Disney Co. and consumers so that they are not left without access to our content (on DirecTV). The proposed pricing is consistent with other agreements we have in the market.”

In his blog post, Thun cited Venu — the joint venture of Disney, Fox Corp. and Warner Bros. Discovery — as an example of a “genre-based product” (i.e., sports) that media companies should also make available to distributors. A federal judge issued a preliminary injunction last week barring Venu from launching, siding with streaming provider FuboTV’s argument that the joint venture was anticompetitive. (The three companies have appealed the ruling.) “We disagree with Venu’s anticompetitive strategy and believe TV distributors should have the same flexibility to succeed alongside DTC services by offering genre-based packages that go beyond sports to include local, entertainment, news, family, movies and more,” Thun wrote.