Twenty-First Century Fox Inc (NASDAQ:FOXA) has announced that it would be backing out from filing lawsuits against Verizon communication’s custom TV bundles. ESPN has also been amongst the suit filers. The announcement was made by CEO, Peter Rice, who also hinted that the two companies might work together and see how the new bundles evolve. Fox President, Chase Carey, also revealed recently, that his company believes that the public wants a number of channels in a single package.
ESPN, however, is still pursuing its court filings, which state that the Verizon is violating its contracts with the customers about the bundle. The lawsuit also states that the company has violated some of the compulsions in its license agreements. ESPN is urging the Supreme Court of New York to charge a heavy fine.
When Fox had decided to file its lawsuits, it highlighted that Verizon’s new custom-pay TV service was not properly priced. The price structure itself had been violating the contract with customers. The two had made their filings, especially, because both channels had been tagged as uniquely priced in the bundle.
Mr. Rice also reflected on the president’s remarks that viewers want more for less. People prefer paying $80 for 100 channels, rather than pay $75 for 20 selective channels. He also revealed that his company has been working to offer flexibility to the distributors.
Fox had recently reported a 1.2% increase in revenues, which had been attributed to its cable networks and success of some of its movies. However, the recent move by Verizon is the latest addition to the divide between distributors and networks. While the distributors are trying to slim down the channel count and reduce a portion of the prices, networks, like Fox, believe that the industry should keep operating as it is in its current state.
Twenty-First Century Fox Inc (NASDAQ:FOXA) closed at $32.78 after losing 2.67% on May 7. The company has 1.41 billion shares in the market, with a 52-week range of $31.01-$39.27.