Disney to pay $50 million in streaming carriage settlement
Eligible YouTube TV and DirecTV Stream subscribers have until September 2026 to claim compensation under the proposed agreement, which Disney denies involves any wrongdoing.
Disney has agreed to a $50 million settlement to resolve a class action lawsuit brought by subscribers of YouTube TV and DirecTV Stream. The legal action, originally filed in 2022 by four YouTube TV users, alleges that the media conglomerate’s carriage agreements with streaming live pay television providers granted it excessive pricing power. The settlement resolves claims that these terms forced competitors to increase subscription costs by inflating the value of Disney’s own products, including ESPN and Hulu.
Under the proposed agreement, eligible subscribers who were active between April 1, 2019, and March 31, 2026, may claim compensation. All claims must be submitted through an online settlement portal by September 8, 2026. While the total settlement figure is fixed, the specific cash payout per user has not been disclosed, and payments are expected to be distributed following the final court approval hearing scheduled for January 14, 2027.
The lawsuit argued that Disney’s ownership of Hulu, the second-largest streaming live pay television provider behind YouTube, allowed it to influence prices across the broader market. Rival distributors were reportedly compelled to include ESPN in their standard channel packages, a requirement that prevented them from offering cheaper bundles to consumers. This dynamic allegedly gave Disney significant leverage over the entire streaming market, driving up costs for subscribers across competing platforms.
The settlement follows a history of contentious carriage disputes between Disney and its distribution partners. Notably, a 15-day blackout of Disney-owned channels on YouTube TV last year reportedly cost the company $110 million in lost revenue. This figure is more than double the $50 million Disney is now agreeing to pay in compensation to subscribers, highlighting the financial stakes involved in these distribution negotiations.
Disney has denied any wrongdoing regarding the allegations. The proposed settlement agreement was reached in March and received preliminary approval from the US District Court in Northern California later that month. Final approval remains pending, with the court set to review the matter at the January 2027 hearing. The outcome of this final review will determine whether the compensation fund is formally established and distributed to eligible claimants.
