Disputes with cable companies over contracts seem to occur yearly

It seems as though every year cable viewers here in Massachusetts and elsewhere could lose the ability to watch cable channels they rely on for news, sports and other entertainment. At the end of 2018, those customers were at risk of losing channels owned by Disney if they use Verizon Fios for access. When contracts come up for renewal, one party may take the opportunity to negotiate a better deal, which should only be done when that party is willing to walk away.

When it did not look like Verizon and Disney would reach an agreement, customers were told they may find their former Disney channels blacked out. Disney decided to let customers know that they could potentially lose access to channels such as ESPN and ABC at a time when football playoffs would occur. This may have been a strategic gamble on the part of the entertainment channel giant, but it may have had an effect.

Verizon fired back in a press release indicating that the company had not abandoned negotiations and attempted to reach an agreement as soon as possible in order to avoid service outages. It also let customers know that these types of contracts require periodic renewal. As the year drew to a close and the expiration of the contract loomed, the parties finally reached an agreement on Dec. 30, 2018.

What is the point that this story illustrates? It lets all businesses know, including those in Massachusetts, that certain gambles must be taken if they want better terms when their contracts are up for renewal. Of course, it is important to first determine whether a particular gamble has the chance of succeeding. This may include understanding all of the legal implications associated with such negotiating tactics.