T-Mobile’s new TV service may already be falling apart: Deeper Dive

(T-Mobile) Discovery and ViacomCBS are not happy with TVision's packaging of their programming.

T-Mobile’s reimagined live TV service just launched on Sunday but it may already be in trouble after running afoul of several cable network groups.

The primary point of disagreement appears to be TVision Vibe, a $10/month package of 30 channels including AMC, Comedy Central, Discovery, Food Network, HGTV, IFC, MTV, Nickelodeon and more. Discovery CEO David Zaslav said his company was shocked to see some of its channels being sold that way.

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“We were very surprised with how T-Mobile decided that they were going to bundle our networks, particularly because we have a clear agreement where our networks are required to be carried on all their basic-tier OTT offerings,” said Zaslav during Discovery’s earnings call on Thursday. “We're in active discussions with them to quickly resolve that issue. We don't believe they have the right to do what they're doing right now. And they know, it's very clear to them, and they're focused on it.”

Discovery isn’t alone in its concerns.

A source familiar with the situation said ViacomCBS was also surprised and troubled by the TVision announcement. The programmer has made T-Mobile aware that TVision doesn’t have the right to offer its networks as currently packaged.

TVision Live – T-Mobile’s $40/month streaming TV package that includes major broadcast networks along with several news and sports networks like CNN, Fox News, ESPN and FS1 – may also be causing issues with programmers. TVision Live TV+ includes channels like Big Ten Network, NFL Network and several NBC regional sports networks for $50/month and TVision Live Zone includes channels like NFL RedZone and Universal Kids for $60/month.

A source familiar with the situation said that NBCUniversal has notified T-Mobile that the current TVision offerings are in breach of its current contract. The companies are currently exploring options for resolving the issue.

Despite issues with programmers, T-Mobile said TVision is "off to a great start."

"We also want to be a great partner to media companies. We are of course complying with our content agreements, and we are absolutely open to evolving our services to make them even better for consumers. We are just getting started," said a T-Mobile spokesperson.

T-Mobile acquired cable operator Layer3 in 2018 and after several stops and starts, relaunched it as TVision in 2019. Last week, the company announced the new TVision service packages along with the TVision Hub, a $50 Android TV device. T-Mobile has tried to position the new TVision as a cable industry disruptor.

“The Cableopoly holds TV fans hostage, bundling live news and sports into expensive packages with hundreds of other channels that people don’t want, and don’t watch. Something’s gotta change. And that’s what the Un-carrier does best — force change. Just like we changed wireless for good — today we’re going to change TV for good,” said T-Mobile CEO Mike Sievert in a news release.

T-Mobile may have time to restructure its TVision channel lineups to ensure the service is no longer in breach of its programming contracts. However, if the issues are not resolved, it’s possible that programmers could start pulling their networks from the service.

TVision is less than a week old and is still only available to T-Mobile’s postpaid wireless subscribers. T-Mobile plans to extend the service to prepaid and legacy Sprint subscribers this year and to everyone else in 2021. That means any potential programming disputes are not likely to impact many subscribers yet. However, if TVision wants to scale and take on the current pay TV industry, it will first need to get back into the good graces of programmers.