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ABC, Time Warner ink pact
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May 25, 2000: 6:26 p.m. ET
Cable TV dispute ends; Time Warner to add Disney channels
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NEW YORK (CNNfn) - Time Warner and Walt Disney Co. on Thursday said they had reached a long-term agreement to carry Disney's ABC television network and other cable channels on Time Warner's cable systems, ending a bitter dispute over access and rights fees.
The companies did not disclose the financial details of the agreement, which was announced in principle on May 18 at the Time Warner annual shareholder's meeting.
 The entertainment giants signed a new deal - replacing one that expired December 31, 1999 - that ensures Time Warner Cable's customers will continue to receive the programming of ABC-owned television stations through May 2006. Separate deals beef up the number and distribution of Disney-owned cable TV stations on Time Warner systems, a key point of contention during the talks.
The Disney Channel will be converted from a premium channel -- available at extra cost -- to a free channel for most customers, by January 2003. The companies extended agreements for popular Disney-owned cable sports networks ESPN, ESPN2, ESPN Classic and ESPNEWS, which make those channels available to a greater number of viewers.
According to a source familiar with the talks, the deal also contains restraints on future price increases for the primary ESPN network.
In addition, Time Warner, the parent of CNNfn.com, signed an eight-year deal to carry Disney's new soap opera channel SoapNet, and inked a long-term deal to add the all-animation channel Toon Disney. A development period for two additional cable channels was also agreed upon.
A Time Warner Cable spokesman said the companies agreed not to discuss the timing of the launch of the new stations. But he noted that Time Warner does not expect its customers' cable bill to rise sharply as a result of the agreement. Prices will climb "only pennies per month," he said, in line with previous increases.
 Negotiations between the media giants broke down on May 1, when Time Warner blocked ABC programming from its cable systems in several areas across the nation, cutting off ABC from more than 3.5 million households for some 39 hours.
On Thursday, Joseph Collins, Chairman and Chief Executive of Time Warner Cable, apologized again for the incident, which was seen by many as public relations blunder by Time Warner.
"We are very pleased to have reached this long-term, wide-ranging agreement with Disney that puts an end to the companies' programming dispute," he said. "At the same time, we want to reiterate our regret that Time Warner subscribers were put into the middle of these negotiations."
Last week, Time Warner Chairman Gerald Levin credited Time Warner President Richard Parsons and Disney President Robert Iger for working hard to close the pact. 
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