Disney blocks commercials for Verizon skinny bundles

TV and radio stations owned by the Walt Disney Company and 21st Century Fox are refusing to run commercials in New York promoting Verizon's (NYSE: VZ) new "Custom HD" pay-TV program bundle system, the wireless giant says.

According to Bloomberg, Disney's WABC-TV and ESPN Radio in New York have both refused to run ads for the new FiOS product that gives FiOS customers greater control in assembling their pay-TV bundle.

"WABC-TV will not accept the new Verizon FiOS customized bundle creative," reads a WABC email obtained by Bloomberg.

"Disney's anti-competitive tactic is only hurting the consumer," Verizon's spokeswoman told Reuters. "From our perspective there is no dispute."

Verizon said Fox adopted a similar strategy in regard to WNYW-TV and the YES Network.

However, Verizon added that Disney did run ads for the new service offering in Washington, D.C., Boston and Pittsburgh.  

Verizon introduced Custom HD last Sunday. The new bundling system allows subscribers to buy a package of 35 basic cable and broadcast channels for $54.99, then choose between two of seven add-on packages of networks themed around "sports," "kids," "news," etc.

Disney and Fox have both said they haven't agreed to the strategy, which disaggregates larger networks like ESPN from smaller ones like Disney XD.

Verizon, meanwhile, says the strategy fits a growing consumer demand for smaller, more flexible programming bundles, and that it can execute such a product based on its existing program deals.

For more:
- read this Bloomberg story
- read this Reuters story

Related links:
Verizon's Shammo: We believe our 'existing contracts' allow skinny bundles
Disney/ESPN says it didn't consent to Verizon plan to break up bundles
Verizon FiOS will debut skinny bundle that rivals Sling TV
Verizon adds college-sports programming to upcoming mobile video service
Verizon's 'managed services' plan for video streaming could violate net neutrality rules